Microcredit Media ArticlesExcerpts of Key Microcredit Media Articles in Major Media
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Bangladeshi microcredit pioneer Muhammad Yunus and his Grameen Bank were awarded the Nobel Peace Prize on Friday for their work in advancing economic and social opportunities for the poor, particularly women. The economist and the bank he founded will share the prize. They were cited for their efforts to help "create economic and social development from below" ... by using innovative economic programs such as microcredit lending. Grameen Bank has been instrumental in helping millions of poor ... improve their standard of living by letting them borrow small sums to start businesses. Loans go toward buying items such as cows to start a dairy, chickens for an egg business, or mobile phones to start businesses where villagers who have no access to phones pay a small fee to make calls. "Every single individual on earth has both the potential and the right to live a decent life. Across cultures and civilizations, Yunus and Grameen Bank have shown that even the poorest of the poor can work to bring about their own development," the Nobel Committee said in its citation. Microcredit is the extension of small loans, typically US$50 to US$100, to entrepreneurs too poor to qualify for traditional bank loans. The bank claims to have 6.6 million borrowers, 97 percent of whom are women, and provides services in more than 70,000 villages in Bangladesh.
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Making tiny loans to poor entrepreneurs in developing countries has long been a popular charitable cause, but it is now gaining traction as an investment. Microfinance, as these loans are known, is aimed at lifting some of the world's most destitute people out of poverty by providing seed money for small businesses. Funding for the loans traditionally has come from charities and government-aid organizations. Now, an increasing number of private funds are steering capital to microfinance. Many of the new investment instruments have been launched by nonprofit organizations long involved in the industry, including Grameen Foundation USA, the Foundation for International Community Assistance, both in Washington. Microfinance investing got a boost this fall when eBay Inc. founder Pierre Omidyar and his wife, Pamela, gave $100 million to Tufts University to create a fund that invests in microfinance vehicles. Microfinance investment funds...lend money for small-scale businesses, such as vending fruit, weaving shawls or operating small farms in poor countries around the world. Calvert Foundation offers Community Investment Notes, which require a minimum $1,000 investment, and can be earmarked to invest in developing countries or other initiatives, including post-Katrina recovery on the Gulf Coast.
Note: Microfinance is one of the most empowering movements in the world. When we let go of our fears around finances and put our money where our heart is, we invite major transformation into both our personal lives and our world. For how to get involved, see http://www.WantToKnow.info/051023microcredit
Several major media articles have sung the praises of microcredit, also known as microfinance and microlending: New York Times: Tiny Loans Make a Big Difference in Lives of Poor; Wall Street Journal: A new way to do well by doing good; BusinessWeek: Microfinance funds lift poor entrepreneurs—and benefit investors; The Economist: Microcredit in India, High finance benefits the poor; Excellent general article in Time magazine titled "The End of Poverty" CNN/Associated Press: Bankers for poor win peace Nobel. Without donating a penny, you can help to break the cycle poverty in a very real way. Microcredit investments are not donations or charity. Like other investments, the money is always yours. You even earn a small amount of interest. Yet for every $1,000 you invest, several entire families in the developing world can be pulled out of poverty every year. That is part of the reason why the United Nations declared 2005 to be the International Year of Microcredit and why the individual and group who originated the microcredit concept were awarded the Nobel Peace Prize in 2006. To download a free 24-page guide to microcredit and community investing, click here. And note that these investments are not influenced at all by market fluctuations.
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Muhammad Yunus has had phenomenal success helping people lift themselves out of poverty in rural Bangladesh by providing them with credit without requiring collateral. Yunus developed his revolutionary micro-credit system with the belief that it would be a cost effective and scalable weapon to fight poverty. Yunus told his story and that of the bank in the book Banker to the Poor, co-authored [with] Alan Jolis. In the book, Yunus recalls that in 1974 he was teaching economics at Chittagong University in southern Bangladesh, when the country experienced a terrible famine in which thousands starved to death. As the famine worsened he began to dread his own lectures. "Nothing in the economic theories I taught reflected the life around me. How could I go on telling my students make believe stories in the name of economics? I needed to run away from these theories and from my textbooks and discover the real-life economics of a poor person's existence." Yunus went to the nearby village of Jobra where he learned the economic realities of the poor. Grameen Bank was born and an economic revolution had begun. The bank has provided $4.7 billion dollars to 4.4 million families in rural Bangladesh. With 1,417 branches, Grameen provides services in 51,000 villages, covering three quarters of all the villages in Bangladesh. Today, more than 250 institutions in nearly 100 countries operate micro-credit programs based on the Grameen Bank model, while thousands of other micro-credit programs have emulated, adapted or been inspired by the Grameen Bank.
Poverty can be solved, declares Muhammad Yunus. A former economics professor, who holds honorary doctorates from 22 universities in 11 countries, Yunus has seen for himself what works and what doesn’t work in Bangladesh, just about the poorest country in the world. "Charity is not the way to help people in need. If you want to solve poverty, you have to put people in a position to build their own life. Unfortunately, this is not how the aid industry works. Western governments and development organizations think they need to offer permanent charity. As a result, they keep entire economies in poverty and families in an inhuman situation." As founder of the Grameen Bank, he is the creator of a concept that now represents an emerging force in the financial world: microcredit, small loans for poor people. Grameen has become a model for banks in nearly 100 countries. "I still think we can cut poverty in half within 10 years and can eradicate it within a human lifetime. Credit is one of the barriers we must eliminate so that the poor can clamber out of poverty. Thanks to the mobile telephone, farmers in Bangladesh can negotiate directly with their customers. Via internet, farmers find out the actual market value of their goods, enabling them to strengthen their negotiating position. They are no longer forced to rely on the clever middleman who kept the farmers in ignorance and took off with their money." Yunus has demonstrated that combating poverty starts with action. And that these actions can sometimes even make a profit.
Important Note: Explore our full index to key excerpts of revealing major media news articles on several dozen engaging topics. And don't miss amazing excerpts from 20 of the most revealing news articles ever published.