As people worldwide, especially people with low incomes, gather themselves and restore their dislocated lives, a lot and adjust to the new realities. Financial Express Online contacted Muhammad Yunus, the Nobel laureate from Bangladesh and the founder of the Grameen microcredit model, on how he coming as he is often referred to by those who know him or engage with him.
Professor Yunus talks of how he sees change happening and the course ahead in micro-lending, a space that he pioneered and inspired many in India worldwide. He also talks ofthat has been engaging his attention for quite some time now. He speaks of virtual meetings replacing physical interactions, albeit some challenges need to be overcome where connectivity is a challenge. He also sees room for CSR (corporate social responsibility) fund flow into social business and moots a social business microcredit bank. Excerpts from the interview:
One of the essential pillars of the micro-credit movement has beenand their interactions with the field staff from microfinance institutions. A lot hinged on these face-to-face interactions. How do you see this pan out in of social exclusion, and if physical meetings are a challenge, how will the social collateral be established in the new environment?
The pandemic is a new phenomenondislocation in poor people’s lives. But this is not the only disaster that microcredit borrowers have faced. Bangladesh is known as a country of disasters. The situation gets worse because of . Some parts of the country go underwater yearly because of a local flood. Then there are national disasters of flood at regular intervals. Sometimes goes over the rooftop of the houses. In one flood, boats and steamers became modes of transportation in Dhaka city. Cyclones and tidal waves are regular visitors in the southern part of the country. These are more serious than a pandemic. Nothing escapes these disasters — houses, animals, material possessions, lives, etc.
Just go through the history of disasters and microcredit in Bangladesh, then you’ll see the detailed institutional safety mechanisms built into these programs. Microcredit has learned to survive financially and organisationally through these regular disasters. If it could not deal with these, microcredit would have been wiped off long back.
The microlendingon frequent meetings – weekly or monthly – collecting and exchanging cash and attending group training. Central to these were the built-in economies of scale as collections by microfinance institutions were made at one location. How will this model and affect economics? For instance, will it become more expensive as representatives from microfinance institutions visit each member instead of holding group meetings?