Banker of the Poor: Dr.

Muhammad Yunus

Now a day the most talked about word in business world after Marketing is Entrepreneurship.
LPU is also taking different kind of initiatives to develop entrepreneurial spirit in students. The
following article is based on social Entrepreneurship.

Muhammad Yunus is a Bangladeshi banker and economist. Previously he was a professor of

economics where he developed the concept of microcredit. He is considered to be the pioneer in
the field of microfinance. He is categorized as the social entrepreneur in the area of
microfinance.

Muhammad Yunus was born in 28th June, 1940 in the village of Bathua, in Chittagong, the
business centre of what was then Eastern Bengal. Influenced by the habit of his mother of
helping poor, he committed himself towards the eradication of poverty.

His childhood years were spent in the village. In 1947, his family moved to the city of
Chittagong, where his father had the jewelery business. He completed his Masters Degree in
Economics in 1961from Dhaka University. It was the beginning of his life-long association with
economics. He obtained his Ph.D. in economics from Vanderbilt University in the US in 1971. In
1976 during one of the visits with his students he realized that loan of very small amount can
make a very big difference to the poor. Conventional banks were not interested in making tiny
loans at reasonable interest rates due to high repayment risks.

So Dr. Yunus created a business model as microcredit (also known as grameencredit) through
loans to poor and underprivileged women workers in Bangladesh. And thus he started the bank
named Grameen Bank(Village Bank) in 1976,which was totally dedicated to aid rural population
who could not gain access to loans from other conventional banks. The bank soon became
successful with 96-97% loan returns filed. From this modest beginning, grameen bank today
employs 14,000 staff members and works in 35,000 villages of Bangladesh. Last year it provided
US$ 380 million in 3.62 million loans. And thus Yunus has through Grameen Bank, developed
microcredit into an ever more important instrument in his struggle against poverty.

Muhammad Yunus with his bank has been awarded the prestigious Nobel peace prize in 2006
for his effort to create social and economic development. Besides he has been awarded many
other awards like Presidential Medal of Freedom in 2009, the King Abdul Aziz medal in 2007,
the Ramon Magsaysay Award, the Sydney Peace Prize, and in December 2007 the Ecuadorian
Peace Prize. Additionally, Dr. Yunus has been awarded 26 honorary doctorate degrees, and 15
special awards.
-PRASAHNT GUPTA
Reg. No.-10907397
Programme - MBA (H)
Lovely Honours School of Business
Semester- 2nd