Let's all help stop poverty!!

1. Poverty
Grameen Bank
www.grameen.com
Group 15 - 33rd Singapore Company

2. Introduction to Grameen Bank
Aim: To improve the social welfare of
the poor.
Group 15 - 33rd Singapore Company

3. Grameen Bank
How does it work:
1. Start with the problem rather than the solution: a credit system must be
based on a survey of the social background rather than on a pre-
established banking technique.
2. Adopt a progressive attitude: development is a long-term process which
depends on the aspirations and committment of the economic operators.
3. Make sure that the credit system serves the poor, and not vice-versa:
credit officers visit the villages, enabling them to get to know the
borrowers.
4. Establish priorities for action vis-a-vis to the the target population: serve
the most poverty-stricken people needing investment resources, who have
no access to credit.
5. At the begining, restrict credit to income-generating production
operations, freely selected by the borrower. Make it possible for the
borrower to be able to repay the loan.
6. Lean on solidarity groups: small informal groups consisting of co-opted
members coming from the same background and trusting each other.
7. Associate savings with credit without it being necessarily a prerequisite.
8. Combine close monitoring of borrowers with procedures which are
simple and standardised as possible.
9. Do everything possible to ensure the system's financial balance.
10. Invest in human resources: training leaders will provide them with real
development ethics based on rigour, creativity, understanding and respect
for the rural environment.
Group 15 - 33rd Singapore Company

4. History of Grameen Bank
During the terrible Bangladesh famine of 1974 Muhammad
Yunus was inspired to make a small loan of US$27.00 to a
group of 42 families so that they could create small items for
sale without the burdens of predatory lending.
The bank began as a research project by Yunus and the Rural
Economics Project at Bangladesh's University of Chittagong to
test his method for providing credit and banking services to
the rural poor. In 1976, the village of Jobra and other villages
surrounding the University of Chittagong became the first
areas eligible for service from Grameen Bank.[8] The Bank
was immensely successful and the project, with support from
the central Bangladesh Bank, was introduced in 1979 to the
Tangail District (to the north of the capital, Dhaka).[8] The
bank's success continued and it soon spread to various other
districts of Bangladesh. By a Bangladeshi government
ordinance on October 2, 1983, the project was transformed
into an independent bank.
Group 15 - 33rd Singapore Company

5. Impact of Grameen Bank
Report shows that the reduction in poverty in rural Bangladesh
has been much more in upazilas where microfinance membership
increased more rapidly, after accounting for other factors which
drive poverty reduction.
Using nationally representative data, their findings suggest that
poverty reduction among the borrowers due to microfinance is 1.6
percentage points per year. Moreover, microfinance programmes
have spillover effects on the non-borrowers -- their poverty level
goes down by0.3 percentage point a year.
Several studies confirm that micro-credit programmes help
households partially insure against shocks so that they effectively
play an important "safety net" role. One carefully designed study
finds that microcredit borrowers are about 50% less prone to
consumption fluctuation than their counterpart non-member poor
households in Bangladesh.
Group 15 - 33rd Singapore Company

6. Credits
Group 15
Joel Pang Zheng Yao (Leader)
Isaac Wong Wei Quan
David Wan Wai Teen
Samuel Chin Hao Wen
Group 15 - 33rd Singapore Company