A World without Poverty

The Grameen Bank is a community development bank started in Bangladesh. They give small loans (known as micro credit or "grameencredit") to poor people without asking for collateral. Micro-credit loans are based on the concept that the poor have skills that are under-utilized, and with incentive, they can earn more money.
The bank also accepts deposits, provides other services, and runs several development-oriented businesses including fabric, telephone and energy companies. The bank's credit policy to support under-served populations has led to the overwhelming majority (98%) of its borrowers being women.

It was founded in 1976 when Professor Muhammad Yunus, a full bright scholar and professor at the University of Chittagong, launched a research project on how to design a credit delivery system to provide banking services to rural poor. Based on the research results, in October 1983, the Grameen Bank was authorized by national legislation as an independent bank. Later in 2006 the bank and its founder were jointly awarded Nobel peace prize. Grameen Bank is owned by the people who borrow the money, mostly women. The borrowers own 94% of the bank, and the other 6% is owned by the Government of Bangladesh.

The class did not focus solely on the aspect of social business but tried to understand the principle involved in Grameen Bank structure. Micro-credit has been a success for the many banks that have adopted it. According to the World Bank, for instance, micro-credit empowers women by giving them more control over household assets and resources, more autonomy and decision-making power, and greater access to participation in public life.

Another thing is organizational structure. The culture at Grameen Bank is to find ways to eradicate poverty. The management is not concerned about profits they made each day, instead they ask, “How many people have you taken out of poverty today. It is precisely this culture that has allowed the Grameen Bank to achieve so much.

Yunus out of box approach to target the poor rural people in the market segmentation along with approaching women strength provided unique points to the business.