Grameen Banks

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  • At GB, credit is a cost effective weapon to fight poverty Helps the poor who have been ever since kept outside the banking orbit on the ground that they are poor and hence not bankable.
  • The Grameen Bank Project (Grameen means "rural" or "village" in Bangla language Today Grameen Bank is owned by the rural poor whom it serves. Borrowers of the Bank own 90% of its shares, while the remaining 10% is owned by the government.  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. The Bank was immensely successful and the project, with support from the  central   Bangladesh Bank , was introduced in 1979 to the  Tangail District   The bank's success continued and it soon spread to various other districts of Bangladesh. The Bank today continues to expand across the nation and still provides small loans to the rural poor. By 2006, Grameen Bank branches numbered over 2,100. [12]  Its success has inspired similar projects in more than 40 countries around the world and has made World Bank to take an initiative to finance Grameen-type schemes. [
  • The Grameen Bank Project (Grameen means "rural" or "village" in Bangla language Today Grameen Bank is owned by the rural poor whom it serves. Borrowers of the Bank own 90% of its shares, while the remaining 10% is owned by the government.  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. The Bank was immensely successful and the project, with support from the  central   Bangladesh Bank , was introduced in 1979 to the  Tangail District   The bank's success continued and it soon spread to various other districts of Bangladesh. The Bank today continues to expand across the nation and still provides small loans to the rural poor. By 2006, Grameen Bank branches numbered over 2,100. [12]  Its success has inspired similar projects in more than 40 countries around the world and has made World Bank to take an initiative to finance Grameen-type schemes. [
  • The word "microcredit" did not exist before the seventies. Now it has become a buzz-word among the development practitioners. Microcredit is the extension of very small loans (microloans) to those in poverty designed to spur entrepreneurship. These individuals lack collateral, steady employment and a verifiable credit history and therefore cannot meet even the most minimal qualifications to gain access to traditional credit. Microcredit is a financial innovation that is generally considered to have originated with the Grameen Bank in Bangladesh. It has successfully enabled extremely impoverished people to engage in self-employment projects that allow them to generate an income and in many cases, begin to build wealth and exit poverty.
  • Grameen Banks

    1. 3. Table of Contents <ul><li>Introduction </li></ul><ul><li>History </li></ul><ul><li>Objectives </li></ul><ul><li>Microcredit </li></ul><ul><li>How is it different from conventional Banks </li></ul><ul><li>A promise for a better future </li></ul><ul><li>Bibliography </li></ul>
    2. 4. Introduction <ul><li>Grameen Banks provide credit to the poorest of the poor. </li></ul><ul><li>No need for collateral </li></ul><ul><li>It is a banking system based on: </li></ul><ul><ul><li>Mutual trust </li></ul></ul><ul><ul><li>Accountability </li></ul></ul><ul><ul><li>Participation </li></ul></ul><ul><ul><li>Creativity </li></ul></ul>
    3. 5. <ul><li>Grameen means &quot;rural&quot; or &quot;village&quot; in Bangla. </li></ul><ul><li>Origin-1976 </li></ul><ul><li>Founder - Professor Muhammad Yunus, Head of the Rural Economics Program at the University  of Chittagong also a well renowned Nobel Laureate </li></ul><ul><li>He was inspired during the terrible Bangladesh famine of 1974 </li></ul>History
    4. 6. <ul><li>The Bank was immensely successful </li></ul><ul><li>By a Bangladeshi government ordinance on October 2, 1983, the project was transformed into an independent bank </li></ul><ul><li>The Bank today continues to expand across the nation and is owned by the rural poor whom it serves. </li></ul><ul><li>By 2006, Grameen Bank branches numbered over 2,100. </li></ul>History
    5. 7. OBJECTIVES
    6. 8. OBJECTIVES <ul><li>It came into operation with the following objectives:  </li></ul><ul><li>Extend banking facilities to poor men and women; </li></ul><ul><li>Eliminate the exploitation of the poor by money lenders; </li></ul><ul><li>Create opportunities for self-employment for the vast multitude of unemployed people in rural Bangladesh; </li></ul><ul><li>Bring the disadvantaged, mostly the women from the poorest households, within the fold of an organizational format which they can understand and manage by themselves. </li></ul><ul><li>Reverse the age-old vicious circle of &quot;low income, low saving & low investment&quot;, into virtuous circle of &quot;low income, injection of credit, investment, more income, more savings, more investment, more income&quot;. </li></ul>
    7. 9. Microcredit <ul><li>Extension of very small loans (microloans) to those in poverty. </li></ul><ul><li>These individuals lack collateral, steady employment and a verifiable credit history. </li></ul><ul><li>Microcredit originated with the Grameen Bank in Bangladesh. </li></ul><ul><li>It has successfully enabled extremely impoverished people to engage in self-employment projects </li></ul><ul><li>These projects allow them to generate an income and begin to build wealth and exit poverty. </li></ul>
    8. 10. How are Grameen Banks different from Conventional Banks? CONVENTIONAL BANKS GRAMEEN BANKS Conventional banking is based on collateral Grameen system is collateral- free. Conventional banks look at what has already been acquired by a person. Grameen looks at the potential that is waiting to be unleashed in a person Conventional Banks focus on men. Grameen Banks give high priority to women. Conventional banks are owned by the rich, generally men. Conventional banks are owned by the rich, generally men.
    9. 11. CONVENTIONAL BANKS GRAMEEN BANKS Grameen Bank branches are located in the rural areas. Conventional banks try to locate themselves as close as possible to the business districts and urban centres. Clients are taken to the court of Law to recover the loan. A client will not be taken to the court of law to recover the loan. When a client gets into difficulty, conventional banks get worried about their money, and make all efforts to recover the money. Grameen system, in such cases, works extra hard to assist the borrower in difficulty. Interest on conventional bank loans are generally compounded quarterly All interests are simple interests in Grameen Bank
    10. 12. <ul><li>Grameen system pays a lot of attention to monitoring the education of the children (Grameen Bank routinely gives them scholarships and student loans), housing, sanitation, access to clean drinking water, and their coping capacity for meeting disasters and emergency situations. </li></ul><ul><li>Grameen system helps the borrowers to build their own pension funds, and other types of savings. </li></ul><ul><li>In Grameen Bank even a beggar gets special attention. Grameen system encourages the borrowers to adopt some goals in social, educational and health areas. </li></ul><ul><li>People are poor because society has denied them the real social and economic base to grow on. They are given only the &quot;flower-pots&quot; to grow on. Grameen's effort is to move them from the &quot;flower-pot&quot; to the real soil of the society. </li></ul><ul><li>If we can succeed in doing that there will be no human &quot;bonsai&quot; in the world. We'll have a poverty-free world. </li></ul>
    11. 13. Bibliography <ul><li>www. grameen -info.org </li></ul><ul><li>www.wikipedia.com </li></ul><ul><li>www. grameen foundation.org </li></ul><ul><li>www. grameen .com </li></ul><ul><li>www.articles.timesofindia.indiatimes.com  </li></ul><ul><li>www.unesco.org/education/poverty/ grameen .shtml </li></ul><ul><li>www.grameenwalisite.com </li></ul>
    12. 14. Made by: Aadhar, Christopher, Kritika, Somya and Unnati

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