8.35 million borrowers, 96% are women2,565 branches working in 81,379 villages (97% of the villages in Bangladesh)$11.65 billion in loans disbursed with $10.11 billion repaidLoan recovery rate of 97%Borrowers own 95% of the total equity of the bank, 5% owned by gov’tProfitable and has been self-sustaining since 1995—has not taken a donation since 199868% of borrowers crossed poverty line2006 Nobel Peace Prize—Yunus and the Bank
So, essentially, this all started with $27—the amount thatYunus lent to 42 poor villagers so they could repay their debt to the local money lenders & start their own businesses. But through Yunus’ visionary andinnovative approach to solving a problem, this evolved and changed into so much more. Inspired by what can happen with such a small amount of $, Yunus founded Grameen Bank which became a great success and the model has spread throughout the world with the support of Yunus. Grameen Bank on its own is not the solution to poverty. Realizing much more needs to be done, Yunus has constantly been coming up with new entrepreneurial solutions to the problems that face the poor. Access to capital is just the tip of the iceberg. From this notion, the concept of the social business was developed. Profits earned from business activities stay with them to use for expansion and continuous improvement so that more can be done to help the poor. It is this innovative model generating a transformational change within the traditional poverty solutions sector that has been able to take poverty fighting to the next level.
1. Business objective will be to overcome poverty, or one or more problems (such as education, health, technology access, and environment) which threaten people and society; not profit maximization2. Financial and economic sustainability3. Investors get back their investment amount only. No dividend is given beyond investment money4. When investment amount is paid back, company profit stays with the company for expansion and improvement5. Environmentally conscious 6. Workforce gets market wage with better working conditions7. ...do it with joy
Grameen Bank – financial services to the poorGrameen Trust – Training, technical assistance, and financial support for MFIs around the world, including Grameen America in the USGrameen Telecom – Telecommunications services for the poorGrameenCybernet – internet services providerGrameenShatki – Renewable energy sources for rural Bangladesh Grameen Phone – cell phone servicesGrameenShikkha – scholarships and assistance to students of poor familiesGrameen Solutions – IT solutions for businessesGrameenDanone – joint venture between Danone and Grameen to provide nutritious dairy products to poor childrenGrameen Veolia Water – joint venture with Veolia Water to build and operate water treatment plants in the poorest villages in BangladeshGrameen Creative Lab – accelerate social business, create broad awareness for social business, and establish Grameen as a worldwide brand
His dream is of a world in which poverty does not exist. He took this dream and created a movement of business solutions to the world’s most pressing poverty issues. He created this social business model under the premise that innovation is change. For this, he was recently named by Fortune magazine as one of the 12 greatest entrepreneurs of our time—the only social entrepreneur on this list that included Steve Jobs, Mark Zuckerberg, Howard Schultz, Jeff Bezos, and John Mackey, to name a few.The field of social business can be considered in its entrepreneurial stage in some ways and formalization stage in others and Yunus is the driver of this emergence and expansion. Innovation is being driven by the owner—Yunus but there is a definite line of social business services. His management style is still very entrepreneurial because a lot of what is being accomplished is unknown until it takes shape and there is no clear end to the development of this social business model and what can be accomplished by it. This is also what makes this change transformational. He’s creating a new vision and a new strategy for solving global poverty. Innovation is key in Yunus’ development of new Grameen branded social businesses. Yunus is a transformational leader and an innovation champion. His vision to transform the way we address poverty is compelling. He sees a future without poverty and he has a special way of motivating others to commit to this vision along with him. He adopted this concept of social business as his own and showed commitment to it by transforming the Grameen Brand from financial services to the poor to affordable life services to the poor. This vision does not come without risks and success is never guaranteed. Every business that launches has its own unique set of challenges to overcome and not every single one has succeeded. Innovative organizations, however, are able to accept failure because there is always something to learn from failure.
Grameen Brand of Social Businesses
Muhammad Yunus: TransformingGrameen Bank into the Grameen Brand
Grameen Bank’s EmergenceTraditional banking services targeted at the rural poor of Bangladesh• Microfinance: financial services to low-income clients• 1976 Jobra, Bangladesh – Lends $27 to 42 poverty stricken artisans – Counteracts the exploitative practices of the village paikars• Did this solve the problem?• 1977 the Grameen Pilot Project is born• Five stages of growth
Grameen Bank Today• Over 8.35million borrowers, 96% are women• 2,565 branches• More than $11.65 billion in loans disbursed• Loan recovery rate of 97%• Borrowers own 95% of the total equity• Profitable and self-sustaining since 1995• 68% of borrowers crossed poverty line• 2006 Nobel Peace Prize
The Evolution of Grameen Social Business PovertyGrameenBankSocial Business• Problem: Poverty• “Solution”: Grameen BankIs this enough?• The REAL Solution: Grameen brand of Social Businesses