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Annotated captions of Banker to the Poor in English

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Muhammad Yunus is the founder of Grameen Bank.

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Grameen loans money for self-employment to over 4 million poor women in Bangladesh.

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You cannot get a dollar without a dollar in your hand.

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The poor people, nobody gives the first dollar to catch the next dollar.

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Dr. Yunus designed Grameen to serve people who have no collateral.

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Five borrowers form a group and guarantee each others' loans.

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The repayment rate is greater than 98 percent.

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More than half of Grameen's members have moved their families out of poverty.

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We have demonstrated beyond anybody's doubt that it works,

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and it's sustainable and it can work in all kinds of cultural

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and economic situations.

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Grameen Bank has become a model for hundreds of micro-finance programs

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around the world, serving tens of millions of the world's poorest citizens.

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In this program, Dr. Yunus shares the experience and insights gained in his struggle

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to build the world's leading poor peoples' bank.

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Childhood

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I was born in the middle of the Second World War.

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My father was a school dropout. He went up to about 8th grade in school.

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So he was a small jeweler.

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We lived behind the shop that he was running, it's a little one-room place

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in a low-income neighborhood.

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My mother didn't go to school as much as my father did,

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she went up to 4th grade.

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But she always enjoyed reading books and reciting poems.

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So my actual education was with her.

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But gradually I took lot of interest in whatever I was studying at school.

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When the final exam for the primary school came, there was a public examination.

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And I was surprised when the result came out

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that I stood first in the whole municipality.

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Among the things of early years that

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I think had the most impression on me was the independence movement.

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And then came the real independence day in 1947.

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When India and Pakistan were created and two different countries emerged.

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It was a very exciting experience for all of us.

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In 7th grade, I joined the Boy Scouts.

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And then I was chosen to join the Pakistan Boy Scouts Jamboree in Karachi in 1952.

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So that was a very exciting experience for all the kids,

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as there were about two hundred plus kids from East Pakistan

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going to West Pakistan by train from here.

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At 10th grade you matriculate and that's end of your high school period.

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So I appeared in the matriculation exam in 1955.

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I was 15 at that time.

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And again I got an opportunity to join another jamboree,

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the Global Jamboree, to be held in Niagara on the Lake in Canada.

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So these kids for us coming from this tiny lane

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in one little room house going to Canada was a very exciting experience.

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And in New York we were received by the mayor,

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all this little kids from Pakistan. We were 27 in all.

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So this is a big exposure. And then we moved the same way, came to New York,

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took the ship back again to Plymouth in England.

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So we bought three microbuses, Volkswagen microbuses.

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And all the kids, kids who were a little bit more senior than myself,

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they took the responsibility of driving these vehicles,

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and we drove through Europe, all the way to Pakistan.

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College and University

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In the meantime, I got the news:

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I was on the top of the list of all the candidates who matriculated in the East Pakistan at that time.

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And then went to college, but I missed out several months of college because I was away.

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But the college was so intensive for me because it was only a year and half that I spent there.

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Our college is just 11th and 12th class.

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So that period became very important for me.

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All the friendships I made and the activities I joined, the cultural activities and literature activities.

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I was editor of the newspaper, and editor of the magazine.

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I would say one of the best periods of my life...

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Then I came to Dhaka to start my university time.

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I spent four years in Dhaka.

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Finishing my honors in economics and then Masters Degree in economics in 1961.

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But I would say my university days were pretty dull,

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because I decided not to participate in politics.

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I should study rather than getting involved in politics.

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I was really happy that I finished the university.

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I was hoping that this period would be over and I'll be doing something.

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Always I thought I'll be a teacher.

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I did a little bit of research work as a research fellow at the university.

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Then I got the job of becoming a teacher and I took that job and went to Chittagong.

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My posting was in Chittagong College where I passed a few years back,

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so some of my friends are still there as students, while I came there as teacher.

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While I was teaching there, at the same time,

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I was thinking about starting some business.

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And myself, and my older brother

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were thinking what kind of industrial enterprise we can set up.

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One of the things that attracted us was the packaging.

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And that idea came when I was visiting West Pakistan and I saw a packaging plant there.

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A beautiful Swedish/Pakistani joint venture packaging plant.

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Thought we could have a small packaging plant in Chittagong.

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I had no idea how to set up a plant,

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but, just as we went around step by step.

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We did that and...

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that became the first packaging plant in East Pakistan.

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The United States

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Then in the meantime I saw an advertisement in the newspaper,

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that Fulbright scholarships would be given by USA

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and they were asking for applications. So I applied.

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I thought, why not? Let me get a PhD degree.

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So I got selected and that took me to USA in 1965.

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The Fulbright authority chose Vanderbilt University as the place where I should go.

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One thing in general I can say which I enjoyed very much

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was quote unquote freedom, lets say.

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Like you are free, you can talk, you can exchange whatever way you feel,

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you are not afraid of anybody.

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So that part I liked.

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And the same time the paradox of all this, also something that made me very sad.

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In Vanderbilt that was the first year of integration, racial integration.

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Because it was a segregated university until 1964.

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So here a nation which is supposed to be the leader in many many things,

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but not allowing a black person to enter the same restaurant or enter the same school.

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I couldn't believe that.

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Then the Vietnam War, this is the peak of the Vietnam movement,

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anti-Vietnam War movement.

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And the killing of Martin Luther King.

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Killing of Bobby Kennedy and all that seen right on the television screen.

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But within that period the most exciting thing that happened was a particular professor that I was very lucky to be with.

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Professor Georgescu-Rogan, he was a very unusual kind of person.

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First of all, not only he is a great scholar.

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He is mathematician, he is a philosopher, economist...

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He was a great teacher.

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As you listen to him you almost feel like you are in a concert.

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You're enjoying a performance of a great artist.

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But, he gave me one thing, to look at the reality.

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Because the reality is the supreme. Theory is only imitating the reality

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Sometimes we got the wrong kind of messages that as if theory is the thing

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and that we have to build the reality into the theory.

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That idea completely didn't go with him at all.

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So if something didn't match with the theory, debunk the theory.

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Throw the theory, build it new so that it explains what's happening here.

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That part impressed me, instead of looking at the theory, I was looking at the reality.

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Return to Bangladesh

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During my stay in USA, the liberation war broke out in Bangladesh.

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Suddenly the Pakistani army started attacking civilians in East Pakistan,

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and East Pakistan rebelled and declared itself independent.

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And immediately after I listened to the news on the radio,

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we several people, Bangladeshis who lived in, we were six of us in Nashville,

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we gathered together and declared ourselves citizens of new country Bangladesh.

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Within minutes, we did that.

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I joined the movement and I became the secretary of the group.

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And went to Washington to participate in the demonstration,

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to stop the military aid to Pakistan. Which aid was being used against the civilians of East Pakistan.

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So this became a full time work for me.

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At that time this word was very popular word in the early 70s and late 60s: teach ins.

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At the end of 1971, Bangladesh became independent country finally in 16th of December.

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The next question that came to my mind, What do I do?

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I decided that immediately I should go back.

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It was a very difficult country at that time because all the roads are gone,

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bridges are gone so, you practically start from anew.

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Many villages were burned down by the Pakistani army.

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Many professors were killed by the Pakistani army.

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So I was looking for a teaching job and I got the job in Chittagong University and went there.

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And started with a full vigor to build up the departments in the new university, a new department.

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Immediately I thought the students should become familiar with the reality of their life.

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Because our students are usually textbook oriented students.

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This is how educational environment of Bangladesh is.

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So I thought no we should make a departure, we should let them understand what the reality around them.

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And how reality and theory has to work together

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So since the university is located right among the villages,

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I asked them to, got them involved in doing some survey and understanding how people lived there

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what kind of people live there, what are their problems and so on.

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So it was a very exciting thing for me because it was a discovery for me too, I never did that myself as a student.

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And then came 1974...

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In '74 we had a terrible famine in Bangladesh and you can see the famine everywhere.

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You come on the streets, people are dying of hunger and in the beginning you see one, you see two...

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and maybe this is an exception, maybe something is wrong. But gradually numbers kept increasing.

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But nobody says it publicly that there's a famine in the country.

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So I went to the vice chancellor, head of the president of the university where I teach.

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He was a very respected person, he was a writer.

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As a writer; he was a very known person in all of Bangladesh.

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I asked him to sign this statement saying that the situation of the country is bad.

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People are dying of hunger and nobody's paying any attention to it. And all of us in the university,

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all the teachers in the university, we went around signed a statement and put it in the newspaper.

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For the first time the newspaper announced in a big way there's a famine in the country.

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And people are dying and we need to get actions moving.

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And I was very feeling terrible, besides doing the statements and so on, What else can one do?

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It's useless to go on teaching economics the way it is.

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All those beautiful theories, elegant theories, look beautiful inside but it has nothing to do with the reality outside.

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As a human being as an individual person, I can go out and touch another human being

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as they live. And see if I can make myself useful to another human being.

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So I went around seeing such opportunities where they exist to make myself useful to another person even for a day.

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And I was very lucky; I saw lots of such things happening and I could make myself relevant, make myself useful.

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And one thing right away came which is the production of food.

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Country was not growing enough food to feed the people.

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And that led to me to irrigation and dry season.

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Cultivation in the neighborhood university - why land should remain empty, fallow?

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While the university is setting right next to it.

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If the wisdom, if the university symbolized the wisdom of the accumulated knowledge

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of the whole world, that's what the university is supposed to be.

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Why shouldn't that wisdom spill over to the neighbor's field?

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The Women Of Jobra

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So the cultivation and that led to the irrigation,

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became very successful program and lots of food being produced,

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in a season where no food was produced before.

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So I was very happy but at the same time I saw how people,

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poor people didn't benefit from it.

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The landowners, the cultivators, they benefited from this extra rice,

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but not the poor. So this became one of the concern that I couldn't address.

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And as I go around my daily round I saw one woman,

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extremely poor sitting in front of a little broken down hut,

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making bamboo stools, beautiful bamboo stools.

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So I said let's go and talk to her, so we went there and she was very shy she ran away.

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And finally we got into talking and asking how much money she makes.

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So she told me that she makes only 2 cents a day.

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I couldn't believe why she makes 2 cents a day for making that.

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And I said, why can't you sell it to a higher price?

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She said I can't sell it to anybody because I have to sell it to this person.

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And I said why? - Because I borrowed money from him.

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Why did you borrow? - Because I didn't have the bamboo which goes into this bamboo stools.

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- So in order to buy the bamboo I needed the money.

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So I have to borrow from the trader.

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And he lent me the money, with the condition that I must sell my bamboo stools

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to him only, and he decides the price, I have no control over the price.

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Can you get more price if you sell it outside?

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- Of course, I can get more price if I sell outside! But I can't because I am promise bound to sell it to him,

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at the price that he gives me.

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And otherwise he will not give me the money and I can't do anything.

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So I realized that by borrowing money,

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she has become a slave laborer to that person.

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The next day I decided to go around and see if there are more people like her.

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When my list was complete I had 42 names on that list.

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And the total money they borrowed was 27 dollars.

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And I was shocked. This I never realized that could happen anywhere...

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People are suffering not for millions of dollars or billions of dollars, for few pennies

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and there's nothing anybody has done to get rid of this situation.

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So my first feeling is, Why don't I give this money to the people here?

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To repay the moneylenders so that they can become free, which is very simple thing to do.

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For 27 dollars you free 42 people right away.

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So I did exactly that.

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Asked them to give me back whenever they have money to pay back.

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Then something happened.

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The excitement it created in those people hooked me on...

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They thought this was kind of a miracle that happened.

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Because they couldn't think anybody could come up and do such a thing.

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So they looked up to me as if I had done a great thing.

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I said all I did is a few dollars worth of money that's all.

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Then another thought came to my mind. The thought is a very simple one,

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if you can make so many people so happy with such a small amount of money,

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Why shouldn't you do more of it?

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Dealing with Banks

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I toyed around several alternatives; finally I decided.

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Maybe I should link them with the local bank.

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Bank is the one who should be lending money this is their business; this is their job.

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So we go to the branch manager, or the bank manager who is located in the campus.

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Proposed to him that he lend money to the poor people in the village.

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He fell from the sky.

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He couldn't believe I even said that. He said no it can't be done.

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It can't be done. I said, Why not?

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Because he said, poor people are not credit worthy.

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What does credit worthy means?

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Credit worthy means he will not be able to pay back.

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I said how do you know did you lend them at all? He said no, I never lend them.

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How do you know? He said everybody knows that.

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Because they are poor no matter how much money you give

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they will eat and the money will be over, they can't pay you back.

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I went to higher officials and ended up in the city downtown, I talked to them.

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They said the same thing.

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So every time I go and see somebody they tell me the same thing.

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And it went on for months, I couldn't find a door to open.

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Then I learned something from them. And I used it.

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Why don't you accept me as a guarantor? I become your guarantor, I sign all your documents

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risk is on me, not on you. You give the money.

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I thought this is such a straightforward proposal they will immediately go for it, they didn't.

thor 19:58
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In all there were more than six months. Finally, I was accepted as the guarantor.

thor 20:04
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And it worked; I was very excited that it worked.

thor 20:07
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But the bank manager doesn't change his mind.

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He said it may work in one village, but if you do it in two villages it will never work.

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I said Ok let me do it in two villages. So I did it in two villages; it worked.

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He said well, one village and two villages are the same thing, maybe you should do it in five villages.

thor 20:25
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So I did it in five villages and it worked, but he doesn't change his mind.

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After I have done this several rounds, and I realize that if I do the whole world he is not going to change his mind.

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Maybe I should forget about him, so I thought maybe I should have a separate bank...

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Doing exactly what I'm doing.

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And that idea started haunting me, that why don't I have a bank for the poor people?

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The Birth of Grameen Bank

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I was invited to a conference in Dhaka in 1978.

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And one banker challenged me in the conference, if you're so sure it can be done,

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Why don't you do it over a whole district?

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Not just few villages in our university campus. In the university campus you have some advantages,

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your professors, your teachers are making sure that everybody pays back.

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I immediately said, of course I'll do it! If you promise that after I do it over a district successfully

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you will take it up and do it nationwide.

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They agreed but they chose the district Tangail.

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I didn't know anything about Tangail, I had never visited Tangail in my life.

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And then Tangail, I found out after I arrived in Tangail in 1979,

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that there's a whole armed guerrillas working within Tangail.

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This is a remnants coming from the radical movements from the liberation war.

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Going to the villages and killing village leaders,

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and bringing radical communism and so on, that's what they believed in.

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But gradually what we started seeing, they were fighting among themselves.

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And some of them wanted to find jobs with us.

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So we recruited many of these and only condition we put:

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you're welcome to come and work with us, but you must leave the guns.

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You cannot bring your rifles and ammunitions with you.

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So young people left that and started joining us.

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So Tangail is becoming more and more now a reasonable place to work.

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And it is working beautifully and we are very happy.

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But the bankers were not changing their minds.

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So they after two years they raised this question.

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But Tangail is a small district maybe your presence made all the difference.

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Then I said if my presence made all the difference,

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Why don't we take remote districts, far away from Tangail?

thor 23:01
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Reluctantly they agreed, and it worked too.

thor 23:05
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But I see no way banks are going to support that.

thor 23:09
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This is the time then I raised the question maybe I should become a separate bank.

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So we went for institutionalization; that for me was very important thing.

thor 23:19
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If we didn't become an institution and remain spread out

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with different projects ,with different banks, probably it will soon forgotten, removed, finished.

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Anyway, it took me another two years and finally lucky of me and some strange coincidences.

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We got it done, the government approved that.

thor 23:38
23:44

And I was insisting that not only I need the permission, I need a separate law.

thor 23:44
23:50

Because my understanding of the situation was if we are created under the existing banking law,

thor 23:50
23:55

sooner or later whatever I am doing will gradually become the same old bank.

thor 23:55
24:00

Because a law is a mold which will mold it in the same image of the existing bank.

thor 24:00
24:04

But lucky of me, the government accepted that.

thor 24:04
24:11

I drafted the law in collaboration with the lawyers in the country and gave it a shape,

thor 24:11
24:13

and government adopted it as a law.

thor 24:13
24:17

And then we became a bank in 1983, in October.

thor 24:17
24:20

So this is how Grameen Bank was born.

thor 24:21
24:25

The Sixteen Decisions

thor 24:26
24:33

While we were in Tangail early on in 1980 one of the things we did was,

thor 24:33
24:38

sit down with the borrowers and discuss for hours what is the problem

thor 24:38
24:43

how we can solve the problem, or they can solve their own problems and so on.

thor 24:43
24:47

Because we are people not familiar with their life.

thor 24:47
24:51

So we spent a lot of time sitting down,

thor 24:51
24:54

hours after hours talking to them, visiting their homes.

thor 24:54
25:00

And then we got some money to hold workshops from UNICEF.

thor 25:00
25:05

So we used that money to bring these women to sit for five days together,

thor 25:05
25:08

exchange information with each other.

thor 25:08
25:13

And then we opened the subject - what they would like to do now that they are having money.

thor 25:13
25:16

And what are their priorities, what they would like to happen.

thor 25:16
25:19

And then gradually we got into lot of ideas.

thor 25:20
25:23

Then we wrote it down and said ok, this what you said.

thor 25:23
25:27

Carry this because they cannot read and write; we wrote it down and passed it on to them.

thor 25:30
25:37

And each year more decisions were put in until 1984 when we had 16 Decisions.

thor 25:37
25:40

Of the 16 Decisions, the decisions are like,

thor 25:40
25:47

that we shall grow vegetables all year round, and eat plenty of it, and sell the surplus.

thor 25:47
25:52

The emphasis was always on eating because we were going through at that time,

thor 25:52
25:57

night blindness among the children, and it was a common disease all over Bangladesh.

thor 25:57
26:02

Children will lose eyesights and we found out, we were told by the doctors

thor 26:02
26:05

that this is because of vitamin A deficiency.

thor 26:05
26:09

And one way to have vitamin A is to eat vegetables, the kids were not eating vegetables.

thor 26:09
26:12

So this became a big program in Grameen Bank.

thor 26:12
26:16

We shall send our children to school and make sure they are staying in school.

thor 26:16
26:21

We shall have pit latrines to begin with and use it.

thor 26:21
26:25

And then gradually we will have a sanitary latrine in the house.

thor 26:25
26:29

We should not live in dilapidated houses,

thor 26:29
26:32

we should repair the houses, and as soon as possible,

thor 26:32
26:35

we'll have a new decent house built.

thor 26:35
26:38

So it goes on and on and on, on 16 Decisions.

thor 26:38
26:44

And they became instant success, everyone wanted to have copies of 16 Decision.

thor 26:44
26:49

At that time we had no idea it would become so popular with borrowers,

thor 26:49
26:54

and now 16 decision became integral part of Grameen Bank system.

thor 26:56
26:59

Housing Loans

thor 27:01
27:04

Most of the poor peoples' houses particularly in Tangail

thor 27:04
27:09

when we began, were made of jute sticks.

thor 27:09
27:15

Jute stick is a very brittle fragile stick, cheapest material you can get.

thor 27:15
27:19

Imagine the monsoon rain, it's all mud inside.

thor 27:19
27:22

Imagine the winter, the cold.

thor 27:22
27:27

So one of the things right away came, Why don't we give housing loans?

thor 27:27
27:30

and that came through the 16 Decisions.

thor 27:30
27:34

And we are, we didn't think that we could do it ourselves.

thor 27:34
27:38

Then luckily we saw in the newspaper an ad - Central Bank announcing

thor 27:38
27:44

that they will give refinance any bank who wants to lend money to the rural areas for housing.

thor 27:44
27:49

They didn't have us in mind, they were thinking about the well-to-do families

thor 27:49
27:54

in rural areas who want to build their houses and commercial banks can give loan.

thor 27:54
27:58

And we applied for a very small amount of money, $50 or something

thor 27:58
28:02

for a housing loan, and they rejected us.

thor 28:02
28:05

This is not a house, with $50 whatever you build

thor 28:05
28:07

it cannot be called a house.

thor 28:07
28:12

So it doesn't satisfy the definition of a house.

thor 28:12
28:14

So I said - Why are you worried about definition?

thor 28:14
28:17

We want to have something for poor people to live under.

thor 28:17
28:23

We turn around immediately, we applied again calling it a shelter loan.

thor 28:23
28:25

Oh no no, why should we give you a shelter loan?

thor 28:25
28:31

You should be giving what you do giving income. Shelter loan is a consumption loan.

thor 28:31
28:34

Then we quickly changed the application.

thor 28:34
28:38

And gave another - said we want to give a loan for a factory loan.

thor 28:38
28:45

And what is a factory? A factory is because our borrowers are women, they work at home so their home is their factory.

thor 28:45
28:49

They immediately rejected, they thought we were just pulling their legs.

thor 28:49
28:52

And all three applications are rejected. We don't have the money to give.

thor 28:52
28:58

So I decided to go to the, to see the governor of the Central Bank.

thor 28:58
29:01

I said look we need only small amounts of money, that is all.

thor 29:01
29:08

Even your one big conference spends much more money than what we are asking for,

thor 29:08
29:12

and then you have lots of research money.

thor 29:12
29:16

Why don't you just take it as research? Maybe it's working and maybe it doesn't work.

thor 29:16
29:19

Something clicked in his mind. He said ok I'll give you some money.

thor 29:19
29:25

So we borrowed from the Central Bank with the blessing from the governor of the Central Bank.

thor 29:25
29:28

And it started the housing loan program and it worked.

thor 29:28
29:32

Immediately became the hottest item, because it's such an important thing.

thor 29:33
29:36

We require the woman or the borrowers,

thor 29:36
29:42

when they ask for a housing loan that they must show that the land is owned by them.

thor 29:42
29:50

But woman, most of our borrowers are women, they don't have the title to the land because they live in their husband's house.

thor 29:50
29:56

So we said one way, if you are looking for a housing loan, if you want to build a house,

thor 29:56
30:00

convince your husband to hand over the title to you.

thor 30:00
30:04

In the beginning everybody said husbands didn't want to do that.

thor 30:04
30:08

But the desperation was so much. Some of the husbands said ok, why not?

thor 30:08
30:14

And that cured one of the problems that we have in Bangladesh particularly, divorce.

thor 30:14
30:18

Husband divorce their wives very quickly and it's every easy to divorce.

thor 30:25
30:30

So wife has to pack up and go home, go to her parents home.

thor 30:30
30:32

‘cause she doesn't belong to this home anymore'.

thor 30:32
30:37

So after this house is built, husband doesn't say that as quickly.

thor 30:37
30:43

Because if he divorces his wife, he is the one who is to leave the house because the house belongs to the wife.

thor 30:43
30:48

Today we have over 600,000 houses built with Grameen Bank money, with Grameen Bank loan,

thor 30:48
30:54

and all these houses are owned by the women who built this house.

thor 30:56
30:59

Grameen Staff Members

thor 31:00
31:03

Well, for any work, you need a team.

thor 31:03
31:07

If you're playing a game you need a team, to go in business you need a team.

thor 31:07
31:10

So you have to build a team, that's very important.

thor 31:10
31:15

And I talked to my colleagues, my staff in Grameen Bank

thor 31:15
31:19

and explained Grameen Bank is you.

thor 31:19
31:25

What you do is called Grameen Bank. It's not what I do is called Grameen Bank,

thor 31:25
31:28

I shuffle papers in head office, write letters and so on.

thor 31:28
31:30

But you do the work.

thor 31:30
31:36

Whatever you interact with the borrowers, that's the Grameen Bank.

thor 31:36
31:40

So if you are doing the right thing, Grameen Bank is right.

thor 31:40
31:42

If you are doing the wrong thing, Grameen Bank is wrong.

thor 31:42
31:44

As simple as that.

thor 31:44
31:53

We selected them out of almost like a random selection rather than a very involved selection.

thor 31:53
31:58

Because we feel that the people, the staff, can be created inside.

thor 31:58
32:02

We rather prefer people having no experience,

thor 32:02
32:06

particularly we insist that you shouldn't have any experience with the conventional banks.

thor 32:06
32:12

So we do our own molding, and the molding comes through the work itself.

thor 32:12
32:16

They like the job because they see how it works for the poor people.

thor 32:17
32:20

They see how life changes because of their work.

thor 32:20
32:24

And sounds relevant to their own life.

thor 32:24
32:28

Like for example, one of the things again, 16 Decisions,

thor 32:28
32:33

that we shall send our children to school, make sure they stay in school.

thor 32:33
32:37

Through them they see their own brothers and sisters back home.

thor 32:37
32:40

And when the students, these kids get scholarships,

thor 32:40
32:46

they enjoy as if their brothers and sisters were getting scholarships or student loans.

thor 32:46
32:50

This is something that is part of their dream too.

thor 32:50
32:55

The Flowering of Democracy

thor 32:57
33:01

Grameen Bank runs with a system of groups of 5 people together.

thor 33:01
33:03

Elect their chairperson, elect their secretary,

thor 33:03
33:09

so there is the first time they get exposure, how to occupy kind of a public office.

thor 33:09
33:13

When election time came, national election, next political election in the country.

thor 33:13
33:20

I encouraged them to go and vote because votes are important, your views should be heard.

thor 33:20
33:25

But in the beginning they were really reluctant, what is the use, they are all thugs, they are all crooks.

thor 33:25
33:29

Why should we go and waste our time voting for them.

thor 33:29
33:37

So we explained to them that if we don't vote, then the worst of the crooks will get elected.

thor 33:37
33:43

So we have a choice. We can at least find the least of the crooks, the least of the thugs,

thor 33:43
33:47

and that immediately they understood. Yes, that we can do.

thor 33:47
33:52

And they got really energized. From then on, they are participating in the election process.

thor 33:52
33:55

But we didn't realize that that will spill over to something else.

thor 33:55
33:59

Once they got into the voting, they realized how much political power they have,

thor 34:00
34:03

because all the candidates started coming, campaigning for themselves.

thor 34:03
34:07

sit waiting in their central meetings, to give a chance to speak for five minutes.

thor 34:07
34:12

Even the top leaders, because they are big voting blocs.

thor 34:12
34:18

When the local election time started coming, they became candidates themselves.

thor 34:18
34:23

And their explanation is why should we go and look for the least of the crooks?

thor 34:23
34:27

We are good people, why don't we become candidates?

thor 34:27
34:33

So in the '97 election, there was a tremendous amount of support for the Grameen members

thor 34:33
34:40

getting elected by other Grameen members. We started out a few hundred elected positions,

thor 34:40
34:45

five years back, and then 2000 and then last year there was local level election

thor 34:45
34:52

and the total number of elected officials in the local bodies was 12,000.

thor 34:52
34:56

Out of that, 3,000 plus was from Grameen borrowers.

thor 34:57
35:00

Grameen Phone

thor 35:02
35:06

Along the way what we did in 1995 we came up with another idea.

thor 35:06
35:13

while we do the Grameen Bank, I became a strong advocate of Information Technology

thor 35:13
35:20

coming to the poor people. I said if we can bring micro-credit, which is the Grameen program,

thor 35:20
35:28

and Information Technology to the poor people, then it will be faster to get out of poverty,

thor 35:28
35:34

and we got an opportunity. Government was inviting applications for licenses for mobile telephone companies,

thor 35:34
35:40

we applied, and after a long procedural battle, finally we got the license.

thor 35:40
35:42

And we created Grameen Phone.

thor 35:42
35:45

The idea is to bring mobile phone into the rural areas of Bangladesh.

thor 35:45
35:51

And then give mobile phone in the hands of the poor women, with the financing from Grameen Bank,

thor 35:51
35:56

so that she can start selling the service of the telephone, and become the telephone lady of the village.

thor 35:56
36:01

And anybody who needs to call anywhere, they can come to her, and pay her,

thor 36:01
36:06

and use her phone, and she makes the money and villages have a telecommunications system going.

thor 36:06
36:10

Today there are more than 100,000 telephone ladies all over Bangladesh.

thor 36:10
36:16

You can go almost anywhere in Bangladesh, call anywhere in the world, because there is a telephone lady,

thor 36:16
36:21

who has a telephone you can use and she makes money and you get connected.

thor 36:23
36:26

Grameen Two

thor 36:26
36:34

Bits and pieces came, different kinds of amendments in our system, tiny bits and pieces altogether,

thor 36:34
36:40

so at one point we realized we had lots of those bits and pieces, something worked, something didn't work.

thor 36:40
36:46

We thought maybe we should pull them all together. And things we wanted to do before and never did it,

thor 36:46
36:48

because we were afraid this would drop the whole system.

thor 36:48
36:53

Let's go bold, and put them all together, try it in one go in a massive way.

thor 36:53
36:57

And that we put them together and called it Grameen Two

thor 36:57
37:03

the same system but more generalized. Grameen system, in the beginning, we were worried

thor 37:03
37:07

if we make it complicated, people would not understand, they do not read and write and so on, to make it very simple.

thor 37:07
37:15

So all of our loans were for one year. And it is all paid in equal installments over a period of one year, 52 weeks.

thor 37:15
37:20

So that's how we work. Now we realized people were mature, so we changed that.

thor 37:20
37:25

We said loans could be for any period, it could be shorter than a year, it could be longer than a year,

thor 37:25
37:30

it could be several years, it could be several months, and made the installment, for example, also variable.

thor 37:30
37:35

Instead of having the same amount every week, we said it could be more, it could be less and so on.

thor 37:35
37:41

But for individual persons, already there are many members who have spent 10 years

thor 37:41
37:46

or more with Grameen Bank, are capable of handling bigger size of money,

thor 37:46
37:52

so in Grameen Two we have another stream working where you can borrow larger amounts.

thor 37:52
38:00

The largest loan will be over $10,000, one single loan. And we add a few more savings products.

thor 38:00
38:07

Like pension fund, so we give this attractive proposal, and that if you put some money

thor 38:07
38:12

along the way each week, a small amount over a period of 10 years, whatever money you have put in

thor 38:12
38:16

over a period of 10 years, you get almost double that money.

thor 38:16
38:20

This was a very attractive proposition for them to accumulate money.

thor 38:20
38:24

So this is, in total, what is known as Grameen Two.

thor 38:24
38:36

Grameen Bank .. today ... has come a long way. Member wise, we have just crossed the 4 million mark.

thor 38:36
38:44

The reason it can happen so fast, unlike Grameen One, is because our insistence in Grameen Two,

thor 38:44
38:50

the money should come from the same locality, so don't look at us as a supplier of your money.

thor 38:50
38:56

Today almost all branches are profitable because they focus on their money

thor 38:56
39:01

and don't have to borrow and pay interest on their borrowed money to head office.

thor 39:01
39:09

They take the local deposits, pay the interest on their deposits, and lend it out to the borrowers, and make money.

thor 39:09
39:15

So expansion became very simple. We don't want to bring the money to Dhaka, the head office,

thor 39:15
39:18

because we could only invest the money in Dhaka City.

thor 39:18
39:22

And we are always opposed to mobilizing savings in the rural areas,

thor 39:22
39:29

passing it on to the metropolitan areas, and again the metropolitan area making use of that money.

thor 39:29
39:34

I said this is drying up the rural area. So I said we are not interested in the money coming to the city,

thor 39:34
39:40

but you find opportunities to make the investment right there. So that's why more branches are being opened.

thor 39:40
39:49

For the first time in Grameen Bank, the amount of deposit has exceeded the amount of loan outstanding.

thor 39:49
39:54

The Beggars' Program

thor 39:54
40:02

There is a debate going on, for sometime, the debate is, microcredit is a wonderful idea,

thor 40:02
40:07

but it works only for the top layer of the poor people. it doesn't work for the middle level,

thor 40:07
40:13

it doesn't work for the bottom level.. Bottom level and middle level, they need charity, they need handout,

thor 40:13
40:18

they need other kinds of intervention, not credit, because they don't have the ability to use the money

thor 40:18
40:24

loan money for their businesses and so on, they don't have the ideas and skills and so on and so forth.

thor 40:24
40:30

We have been saying that look, we are always addressing the bottom people, that's how Grameen Bank was born.

thor 40:30
40:39

Our first loan was $27 to 42 people. These are not rich people in that village who took less than a dollar apiece.

thor 40:39
40:46

So it started with that idea. So this year we started a beggar's program, we call it struggling members program.

thor 40:56
41:02

would you carry some merchandise with you? Some cookies, some toys, some ribbons

thor 41:02
41:09

some bangles, some candies, that the children may be interested to buy, or a housewife

thor 41:09
41:14

may be interested to buy? So you have both options open, and you don't have to stop begging.

thor 41:14
41:20

And then, pay us back. And this is interest free, and take your time, there is no time limit.

thor 41:20
41:29

You are not forced to follow the Grameen Bank rules, we told our staff that for beggar members,

thor 41:34
41:40

So you follow their rules, how they want to do it. The only rules we gave them is the money has to be paid back.

thor 41:40
41:44

In the beginning we thought we would have maybe 3,000 or 4,000 beggars in the program during the year.

thor 41:44
41:49

But we started seeing a big number coming in. And we ended the year

thor 41:49
41:54

by exceeding 26,000 beggars in the program.

thor 41:55
41:59

Key Advice

thor 41:59
42:06

The advice is very simple - look at the issue first, what is it that you are addressing.

thor 42:06
42:11

Unless you are clear about the issue itself, you cannot design anything that .....

thor 42:11
42:15

you may be a very warm hearted person, you are very kind, you want to do good things.

thor 42:15
42:22

just being able to think about good things doesn't make you doing good things.

thor 42:22
42:30

Because you need to translate into an action, action that works. So you have to define your work

thor 42:30
42:37

very clearly, and then design something that matches that thing. And, learn by doing.

thor 42:37
42:44

The first cut you have in your program is not the ultimate, this is just to get you going.

thor 42:44
42:47

And then you notice which is working, just like you build a machine.

thor 42:47
42:53

The first airplane that was built is not the airplane that Boeing builds today, it's different.

thor 42:53
42:59

But the principle has been set, that is the important thing. Our basic features, even today,

thor 42:59
43:05

are still the same thing that we did in Jobra. The basic features never change. We added pieces,

thor 43:05
43:11

we defined things, but basic 5 member group was done in Jobra, weekly meeting was done in Jobra,

thor 43:11
43:20

loan for income generation done in Jobra, and savings done in Jobra...center meetings done in Jobra.

thor 43:20
43:23

so these are the essentials of Grameen system wherever you go in the world.

thor 43:23
43:32

And this is first important thing. And continue to be stubborn about it, because if you get swayed

thor 43:32
43:37

by who says what, whether it can be done, whether it works here, but it may not work in Bangladesh,

thor 43:37
43:42

because this is another country, or it works in Bangladesh, but it won't work anywhere, don't get swayed by those things

thor 43:42
43:50

because people are always waiting there to say no to you. So stay stubborn if you believe in what you are doing.

thor 43:54
44:04

People who are saying things that you can use and improve, not the negative wholesale dismissal.

thor 44:14
44:17

don't think about it, because you are the ultimate designer of the whole thing.