Who is Muhammad Yunus?

You may be familiar with the name Muhammad Yunus because he is one of the most well-known and innovative social entrepreneurs in the world. In 1983, Muhammad Yunus founded the organization Grameen Bank in Bangladesh. Yunus’ mission was to end poverty. The problem, as he saw it was that banks would not make loans to individuals who did not already have money. Also, many banks were located in major cities making it difficult for business-minded individuals living in rural areas to access loans. Yunus believes that individuals have the potential to start their own business and Grameen Bank provides the support to do so. He started by lending money to members of the Bangladesh community. What Yunus did is called microlending. Microlending is the process of providing small loans with low interest. Let me give an example of microlending. My friend starts selling her homemade mini apple pies in the park and she needs $100 to pay for all the materials. I agreed to give her a loan for $100, but in return, she would have to repay me $105 over the course of one year. In this example, it made sense for me to loan money to my friend because she was already generating income daily through pie sales and over the course of one year, she would repay me in small weekly increments. Muhammad Yunus’ microlending model is very similar to the previous example. The women borrowers would repay a portion of the loan weekly, which ensured that the loans would be repaid and that the women were committed to the process. Yunus started by lending money to poor women in Bangladesh. As Yunus continued lending, he noticed that the women who borrowed the money used it to provide food and education for their families compared to men who would use the money for leisure activities. In addition, the repayment rate from women borrowers at Grameen Bank was 97%. Based on Yunus’ original observations, Grameen Bank has been primarily lending money to women. Muhammad Yunus has been widely recognized for his dedication and service to empowering the poor and was awarded the Noble Peace Prize. Muhammad Yunus is an inspiring entrepreneur and has clearly made a difference by changing the lives of impoverished families in Bangladesh and around the world. For those of you who are interested in Muhammad Yunus’ work, I recommend that you read his books including Creating a World without Poverty and Banker to the Poor.

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