Banker To The Poor: Micro-Lending and the Battle Against World Poverty |  | Author: Muhammad Yunus
Publisher: PublicAffairs
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Rating:  87 reviews
Sales Rank: 5927
Media: Paperback
Edition: Rev. and Updated for the Pbk. Ed
Pages: 312
Number Of Items: 1
Shipping Weight (lbs): 0.7
Dimensions (in): 8.2 x 5.5 x 0.7
ISBN: 1586481983
Dewey Decimal Number: 332.1095492
EAN: 9781586481988
ASIN: 1586481983
Publication Date: January 8, 2008
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Amazon.com Review
It began with a simple $27 loan. After witnessing the cycle of poverty that kept many poor women enslaved to high-interest loan sharks in Bangladesh, Dr. Muhammad Yunus lent money to 42 women so they could purchase bamboo to make and sell stools. In a short time, the women were able to repay the loans while continuing to support themselves and their families. With that initial eye-opening success, the seeds of the Grameen Bank, and the concept of microcredit, were planted. After earning a Ph.D. in economics at Vanderbilt University, Dr. Yunus returned to Bangladesh to settle into a life as a professor. But a famine in 1974 ravaged the country, leading Dr. Yunus to alter his thinking and his life profoundly: "What good were all my complex theories when people were dying of starvation on the sidewalks and porches across from my lecture hall?.... Nothing in the economic theories I taught reflected the life around me." Armed with little more than a lofty dream to end the suffering around him, he started an experimental microcredit enterprise in 1977; by 1983 the Grameen Bank was officially formed. The idea behind the Grameen Bank is ingeniously simple: extend credit to poor people and they will help themselves. This concept strikes at the root of poverty by specifically targeting the poorest of the poor, providing small loans (usually less than $300) to those unable to obtain credit from traditional banks. At Grameen, loans are administered to groups of five people, with only two receiving their money up front. As soon as these two make a few regular payments, loans are gradually extended to the rest of the group. In this way, the program builds a sense of community as well as individual self-reliance. Most of the Grameen Bank's loans are to women, and since its inception, there has been an astonishing loan repayment rate of over 98 percent. Banker to the Poor is an inspiring memoir of the birth of microcredit, written in a conversational tone that makes it both moving and enjoyable to read. The Grameen Bank is now a $2.5 billion banking enterprise in Bangladesh, while the microcredit model has spread to over 50 countries worldwide, from the U.S. to Papua New Guinea, Norway to Nepal. Ever optimistic, Yunus travels the globe spreading the belief that poverty can be eliminated: "...the poor, once economically empowered, are the most determined fighters in the battle to solve the population problem; end illiteracy; and live healthier, better lives. When policy makers finally realize that the poor are their partners, rather than bystanders or enemies, we will progress much faster that we do today." Dr. Yunus's efforts prove that hope is a global currency. --Shawn Carkonen
Product Description
A new edition of the New York Times Bestseller by the Nobel Peace Prize-winner. This autobiography of Nobel Peace Prizewinner Muhammad Yunus spent ten weeks on the New York Times bestseller list, and was also a Wall Street Journal bestseller. Now repackaged in the spirit of his new book, Creating a World Without Poverty, this classic work on the birth of microfinance will contain excerpts from the new book.
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Showing reviews 1-5 of 87
 Great read, very inspiring! October 27, 2009
A. Thordsen (Iowa)
The story of the Grameen Bank is absolutely one of the best I have ever heard. Here is an actual solution to end poverty everywhere in the world that has worked already. I could not have been more excited after reading this book that we finally have the means to end poverty once and for all! I would recommend it to anyone who wants to actually get out there and do something!
Banker to the Poor October 13, 2009
Ruth A. Holzwarth (Silver City, NM)
A wonderfully written book about what has been going on in the third world countries by Yunus, and what can be done here in the U.S. You will find the results of the Banker for the Poor a really uplifting read, and wonder what one can do to spread this method to those who cannot reach loans any other way to be successful.
A free-market manifesto October 3, 2009
M. Heiss (USA)
I do not know what Hillary Clinton and Jimmy Carter's endorsements are doing on this book. Muhammad Yunus is the next best thing to Milton Friedman. He's a lot wordier than Uncle Milton, though.
Muhammad Yunus is responsible for a revolutionary approach to poverty eradification: skip the world bank, bypass the UN, abolish the welfare state, and loan the money directly to poor people. Unsecured. No collateral. People know what they need to survive and thrive. Often it is as little as $125 dollars for a tin roof for their shack, so they can continue weaving or grinding grain for sale during the 5-month rainy season. That $125 may be the only thing keeping a family from desperate, filthy poverty and dignified self-sufficiency. But governments and banking traditions get in the way of poverty alleviation and perpetuate the misery.
Grameen bank has partnered with poor people worldwide to help them pull themselves out of poverty through individual initiative. Tiny bits of money to the best tamale maker so he can buy a cart and sell his tamales through town. Tiny bits of money so women can buy grain to grind for profit. Tiny bits of money that do not pass through the hands of bureaucrats or corrupt governments. Microcredit unleashes human potential.
Beginning at page 185, Yunus explores the reality of the welfare state in developed countries: the disincentives for work; the imprisonment of the poor at the bottom; and the tenacity of welfare programs, blocking innovation. Slowly, he describes people turning away from reliance on government. In real life, the taxes taken from rich people do not help the poor. They help the government employees in the bureaucracies. Helping the poor means those bureaucrats are out of a job. Page 204 is a rallying cry for government to get out of the way of individual enterprise. The private sector, unlike the government, is open to everyone.
Loaded with examples of people who have succeeded with micro loans, this book is a winner. Yunus was raised and trained in a marxist/Communist mentality (pp 203-220), but you can tell he is trying to shrug it off. He hasn't found the words yet for what he believes. He still has a hard time admitting capitalism is a benefit to humanity, but he concedes that free markets are very natural and wholesome, and indeed, the only solution for wiping out poverty.
To the extent that we continue to rely on governments for social programs, we will fail the poor.
Exciting to read!
 Some substance, please July 8, 2009
Jonathan Zasloff
5 out of 6 found this review helpful
Muhammed Yunus has worked tirelessly for the poorest of the poor. He has developed an enormously exciting new model for economic and social empowerment. He has expanded it to serve millions of people and give out billions of dollars in loans. His story is thrilling, even inspiring. How in the world can you criticize someone like that?
Well, here's how.
First and most importantly, you can scour through Banker to the Poor and not find anything concrete about whether the Grameen Bank and all of its allied institutions have actually reduced poverty.
In the middle of the book, Yunus says that he wants outside independent auditors to look at the outcomes for Grameen borrowers. I believe him, but the man has been in business for more than 30 years now; it would be nice to have SOME indicator of effectiveness. Moreover, when he discusses the "star" system, whereby individual Grameen branches apply for recognition for outstanding performance, he notes almost in passing that only 21 of more than 1,100 branches have even applied for the "brown star," which is awarded if 100% of the borrowers have escaped poverty. Maybe none of them even received it. Now, 100% is a very tall order and it's not the best indicator. But it is the ONLY one that Yunus offers in the entire book.
Think about the scale of Grameen: it has delivered more than $4 billion in loans since it was founded. That sounds impressive until you realize that Bangladesh has more than 120 million people, about 40% of the size of the United States. $4 billion isn't even a drop in the bucket on that scale.
And yes, Grameen borrowers have a superb record of repayment. But they also paid back the brutally unfair loans that they got from rapacious middlemen before Yunus stepped it for precisely the reason that Yunus explains: they have no other choice. So we still don't know anything about outcomes.
This critique is necessary because Yunus makes some quite extravagant claims in the book, e.g. the government should get out of the business of social service, health care, and education provision altogether. Can the free market provide such things for the poor? Of course not, Yunus says: that's why he needed to start Grameen in the first place. He then proposes a rather hazy notion of "socially conscious entrepreneurs" that will fill the gap, and insists that this sector -- which really has yet to exist anywhere -- can do it. What structures will ensure this? How can the proper incentives be provided? How would these entrepreneurial ventures look any different from the traditional nonprofit sector? Yunus doesn't tell us.
In fact, although Banker to the Poor gives a decent enough overall narrative of Grameen and its founder, it tells us precious little about the model, how it works, and why it is successful. We get a few nuggets: one key innovation appears to be giving loans to small groups of borrowers, who essentially monitor each other. This seems to have been an ingenious idea. And he does discuss how dedicated his staff is, and -- to his great credit -- he names many of the important staffers and how they contributed to the organization. But his account of why such talented people work for Grameen, how he is able to retain them, and whether such staff can be found in other places and at a sufficient scale, is not explained.
My suspicion got piqued when I realized that no one seems to have been able to replicate his model on the scale he has in Bangladesh -- or at least none that he discusses. He does talk about replications, but they seem to be small and not really making a dent.
And I confess to a certain amount of annoyance as to the style of the book: the intrepid advocate Yunus battles intransigent bureaucrats, lazy bankers, arrogant development agencies (who, like the World Bank, nevertheless have funded him lavishly since the early 90's). He even relates the exact words of the exact conversations. This tone is heightened by an overheated performance by Ray Porter in the unabridged audio edition.
This surfeit of heat over light really comes through when Yunus argues that credit should be a "human right." But he simultaneously says that Grameen only wants highly motivated and energized borrowers, who will work and commit to making their businesses become successful. There are lots of people like that, and lots of people NOT like that. What about those borrowers who are not as highly motivated and responsible? Do they have the right to credit, too? Yunus wants to end world poverty, and more power to him: but at the fundamental level, in this book he doesn't really seem to have thought through the most important implications of his argument.
If you know next to nothing about micro-finance, as I did before reading this book, it's worth it. Yunus seems to have done a great deal of good; smart, committed, effective people and organizations support him. It makes a good deal of sense and it's not as if anyone else has the magic bullet. It would just be nice to know exactly what he has done and how he has done it. I'm looking forward to reading his next book and finding out the substance, because Banker to the Poor certainly doesn't provide it.
Bankers, go back to school June 16, 2009
B.Sudhakar Shenoy (India)
1 out of 1 found this review helpful
The last twelve months have been very significant in terms of what can be termed as the financial meltdown and crisis of confidence in the global economy. However the defaults and bankruptcies of businesses and banks have been those run by the wealthy and the highly qualified professionals. On the other hand we have not seen any such crisis in institutions serving the poorest of the poor, where recovery rates for loans have exceeded 98 %. Bankers, go back to school, please. Better still, read this book written by Prof Yunus.
Even after four decades of putting a man on the moon and bringing him safely back to earth, every day, 35,000 children world wide are dying due to hunger related causes. Humanity has successfully fought and eradicated apartheid, slavery and small pox from the face of this planet. However, poverty remains the greatest challenge confronting governments, societies and all of mankind.
This book is a great step to understand one of the key strategies to send poverty to the museums in our lifetime. Prof Yunus's experiment and later large scale success in microcredit and the concept of social business are at the heart of this book.
As a boy of eleven living in India in 1971, I clearly remember the events leading to the freedom struggle and the subsequent liberation of Bangladesh. Prof Yunus's journey from his return from a lucrative teaching job in USA, back to his homeland soon after its independence speaks volumes about his compassion for his fellow citizens, trapped in poverty.
Every chapter in the book narrates Prof Yunus's journey step by step from the basic concept of microcredit starting with his own funds of $27 at the village Jobra, to where the great institution Grameen is today.
Prof Yunus challenges the fundamental premise of banking and turns it on his head. Conventional banking looks for "collateral" for security of its loans, and hence only the rich have access to loans. The poorest of the poor are completely excluded from conventional banking.
Banking needs to have a human face. Gender inequality is one of the key factors that lead to social disparities and the vicious cycle of poverty. Prof Yunus's strategy to target the poorest women even in a very conservative society like Bangladesh proves that we need a totally different approach to address poverty.
The myth that poor will not repay the loans has been fully exposed. (On the other hand we feel shy to talk of mighty corporations filing for chapter 11 and heave a sigh of relief on hearing of massive bailout plans).
The conventional thinking that the poor lack skills, and hence need to be trained, is now a joke. Most of Grameen's beneficiaries are illiterate, but as human beings, they do not lack creativity, ingenuity and above all integrity to put the smallest amounts of credit to good use.
Poverty is not a curse of the poor countries alone. The challenge exists in developed countries, and the solutions we need are remarkably similar.
Bureaucracies are one of the greatest impediments to progress, as demonstrated clearly in this book. However Prof Yunus's courage and persistence to fight it out is a great source of inspiration. I would recommend this book as a compulsory reading in all institutions that train bureaucrats in developing countries.
Prof Yunus openly confronts multilateral institutions, particularly the World Bank. These ivory tower institutions employ highly paid executives who have seen poverty only in text books, and work from posh offices in developed countries, funding and dictating programs aimed at poverty alleviation. I personally do not suspect their good intentions, but fully agree wit Prof Yunus's contention that there is a better way of doing it.
Every word of this book is filled with a great sense of commitment, an inner passion for fighting poverty, and above all the will to succeed against all odds in this holy war, in the true sense of our responsibility to mankind and to God.
My FIVE STAR rating to this book on Amazon.com, since the system does not allow anything more.
I sincerely stand in salute to the great contribution to humanity from this Nobel Laureate of Peace.
Showing reviews 1-5 of 87
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