Article Type

Article

Description

In 1974 a young economic professor of Chittagong University just returned from the U.S after his doctorate in an exoteric topic when the famine struck Bangladesh. He approached the people of a village nearby the University as to how he could help them and discovered that their biggest problem was they were so heavily indebted to the moneylenders that they had almost lost their freedom of individual action. The moneylenders were charging exorbitant rates of interest that were multiplying the outstanding amount exponentially beyond the capacity of the poor villagers. He offered to provide his own personal funds to them so that they could pay off the moneylenders. Professor Yunus felt that this was a kind of donation from him to get the villagers out of an adverse situation. To his utter surprise, he found that the villagers paid back the full amount to him. This experience led him to think that the poor were better borrowers and the loans extended to then were relatively safe and secure. Unlike the influentials they were in no position to delay a default on their loans because if they did so they would be cut off from access to funds in the future and this will destroy their earning capacity.

Publication Source

Dawn

Publication Date

10-15-2006

Pages

1-3

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