Grameen Bank

Grameen Bank is a Bangladeshi microfinance institution founded by Muhammad Yunus that provides small loans, primarily to people excluded from conventional banking.

Microcredit: The provision of small loans to people and businesses with limited access to conventional credit. Grameen Bank became a prominent institution for lending this kind of credit.
Muhammad Yunus: A Bangladeshi economist who founded Grameen Bank and shared the 2006 Nobel Peace Prize. Yunus developed the lending experiments that led to the bank’s creation.
Nobel Peace Prize: An annual international award recognizing contributions to peace. The 2006 prize recognized Grameen Bank and Muhammad Yunus jointly.
Social business: An enterprise designed to address a social problem while operating on a financially sustainable basis. Yunus connected Grameen’s mission to a broader model of socially focused enterprise.
Group lending: A lending method in which borrowers join groups that share responsibility for loan repayment. Early Grameen loans used peer groups to support repayment without traditional collateral.
Jobra: A village in southeastern Bangladesh near Chittagong, associated with early Grameen lending experiments. Yunus began lending small sums to villagers in Jobra in the 1970s.
Fazle Hasan Abed: A Bangladeshi social entrepreneur who founded BRAC, a major development organization. Abed built a different institution addressing poverty alongside Grameen Bank.
Poverty alleviation: Efforts to reduce deprivation in income, health, education, and other basic needs. The bank presents access to credit as one route to reducing poverty.
Joint liability: A legal or social arrangement that makes multiple parties responsible for the same debt. Shared repayment pressure helped substitute for collateral in Grameen’s early model.
Bangladesh famine of 1974: A severe famine in Bangladesh that caused widespread hunger and death in 1974. The famine sharpened Yunus’s attention to poverty and the limits of economic theory.

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