The Grameen Bank is an organization that was started in India in 1976. It operates as a reversed conventional banking practice. It works by giving people in poverty a loan so that they could start their own business. The borrowers, largely women, receive loans in the order of poorest to richest. They are divided into groups, and in order to receive these loans, the current borrower in each group must pay back their loan in full. This causes them to work together instead of against each other.
Another key element in Grameen’s success is the agreement to the 16 Decisions, which include:
1. We shall follow and advance the four principles of Grameen Bank — Discipline, Unity, Courage and Hard work – in all walks of our lives.
2. Prosperity we shall bring to our families.
3. We shall not live in dilapidated houses. We shall repair our houses and work towards constructing new houses at the earliest.
4. We shall grow vegetables all the year round. We shall eat plenty of them and sell the surplus.
5. During the plantation seasons, we shall plant as many seedlings as possible.
6. We shall plan to keep our families small. We shall minimize our expenditures. We shall look after our health.
7. We shall educate our children and ensure that they can earn to pay for their education.
8. We shall always keep our children and the environment clean.
9. We shall build and use pit-latrines.
10. We shall drink water from tube wells. If it is not available, we shall boil water or use alum.
11. We shall not take any dowry at our sons’ weddings, neither shall we give any dowry at our daughters wedding. We shall keep our centre free from the curse of dowry. We shall not practice child marriage.
12. We shall not inflict any injustice on anyone, neither shall we allow anyone to do so.
13. We shall collectively undertake bigger investments for higher incomes.
14. We shall always be ready to help each other. If anyone is in difficulty, we shall all help him or her.
15. If we come to know of any breach of discipline in any centre, we shall all go there and help restore discipline.
16. We shall take part in all social activities collectively.
By requiring these things, they are encouraging women to take hold of their lives and improve them. This message is one of self-efficacy, or showing them that there are small things that they are able to do that will have a large impact on them. By giving out loans, Grameen is bettering people’s quality of life not only financially, but socially, physically, and intellectually as well. And it is making a lasting impact. It makes a profit every year, refuses donations, has a 99% repayment rate, and is entirely self-sustainable. They have had over 7.5 million borrowers, 65% of whom managed to lift themselves out of extreme poverty and clearly improve their socio-economic status.
The majority of their borrowers are women. They say that, “Women in Bangladesh are neglected by society. Through the opportunity of self-employment and the access to money, Grameen Bank helps to empower those women. In addition, studies have shown that the overall output of development is greater when loans are given to women instead of men, as women are more likely to use their earnings to improve their living situations and to educate their children.”
To learn more about this fascinating organization and the impact they are making, visit their website at http://www.grameen.com/ or go to https://www.grameenamerica.org/ to learn more about their work in the U.S.