Microfinance icon and Nobel Laureate Yunus terminated from Grameen Bank

The government of Bangladesh has compelled Muhammad Yunus from his position at Grameen Bank. Grameen and Yunus are pioneers in the field of microcredit and microfinance, lending capital to poor people to help them set up businesses and generate incomes. Yunus is a noted and vociferous critic of the Bangladeshi government, and some feel it is only an intimidation tactic by the government. Article source – Microfinance pioneer Yunus fired by Bangladesh government by MoneyBlogNewz.

Government forced Nobel prize winner out of a position

NPR states that Yunus was compelled from his placement by the Bangladeshi government. Muhammad Yunus, who won the Nobel Peace Prize in 2006, was ordered out of his placement as managing director of Grameen Bank by Bangladesh Bank, the central Bank for the nation of Bangladesh. As Bank directors are required to retire when 60 years old, Bangladesh Bank claims that Yunus was not complying. Even though Yunus is 70, he was exempt from the law since Grameen Bank was founded under a different law in 1983. After he turned 60, he was given in 2000 an indefinite term of office as Grameen Bank managing director. Yunus is nevertheless in the job while Grameen is combating this.

Microcredit icon and government fight continuously

There has been a constant battle among Yunus and the Bangladeshi government. This has gone on for years now. Yunus has previously accused the government of corruption, while government officials termed the small loans that Grameen lends to the impoverished as “sucking the blood from the poor.”. In 2007, Muhammad Yunus tried to start a political party that failed. Officials have been looking at the operations of Grameen Bank to root out any possible malfeasance for months, after allegations were made of an improper funds transfer, in accordance with the New York Times. All funds were redeposited after Grameen transferred donations from the Norwegian government straight to a Grameen affiliate without the Norwegian government finding out about it. This amount was for $100 million.

Helping the poor with loans

Many know and love Muhammad Yunus and Grameen Bank. This is due to the microfinance loans used to battle poverty in the world by the Bank. Industries are started by poor individuals getting loans from Grameen Bank. These are mostly women. For instance, a very poor clothing maker could get a microloan for a sewing machine and fabric and establish a business and an income. USA Today states that 97 percent of borrowers from Grameen are women. Over $10 billion in loans are out right now. Because of poverty conditions in Bangladesh becoming much better, the Nobel Peace Prize was awarded to Yunus and Grameen Bank in 2006. Several feel like putting the poor in a position where they now have debt is a bad idea since it encourages a bad practice, getting the microcredit model criticism. Others are worried because microlending in other nations has lead to violence when it comes to collecting payments and other corrupt practices.

Information from

USA Today

usatoday.com/money/world/2011-03-02-bangladesh-yunus_N.htm?loc=interstitialskip

New York Times

nytimes.com/2011/03/03/world/asia/03yunus.html

NPR

npr.org/2011/03/02/134190697/bangladesh-forces-microcredit-pioneer-from-bank