Credit for alleviation of rural poverty: the Grameen Bank in Bangladesh
Hossain, M.
Tropicultura 11(3): 115-121
1993
ISSN/ISBN: 0771-3312 Document Number: 304790
The Grameen Bank is a specialized financial institution in Bangladesh that was established to provide credit to the rural poor for the purpose of improving their economic conditions. The hypothesis is that if the poor are provided with working capital they can generate productive self-employment without external assistance. Loans from the Grameen Bank are used primarily for undertaking non-crop-related activities. Loan repayment performance is excellent. Only 0.5% of loans to 975 borrowers surveyed were more than one year overdue, and overdue weekly instalments were only 3.3% of the total amount borrowed. The concept could work in other countries, but taking the bank to the people is an expensive option in sparsely populated areas.