Bdnews24.com, a web-based Bangladeshi newspaper, reports that Muhammed Yunus, the founder of microfinance institution (MFI) Grameen Bank of Bangladesh and a 2006 Nobel Prize winner for championing microcredit, has been accused of secretly transferring approximately USD 100 million in 1996 to Grameen Kalyan, a sister company of Grameen Bank that offers affordable health insurance to Grameen members and their families but does not engage in microlending. The story emerged after a Norwegian documentary, “Fanget I Mikrogjeld” (“Caught in Micro debt”) aired in December 2010 indicating that Dr Yunus breached a contract with Norwegian investors that provided money intended for housing loans by transferring funds from Grameen Bank to Grameen Kalyan [1].
In a written exchange between the Norwegian Embassy and Dr Yunus, provided by Bdnews.com, Dr Yunus responded to a request by the Norwegian Embassy, the Norwegian Agency for Development (NORAD) and the Economic Relations Division in Bangladesh to return the sum to Grameen Bank by indicating that the transfer of money was made so it could be used as a “revolving fund” between the two Grameen entitities; after the money was transferred to Grameen Kalyan, Grameen Bank received it as a loan with an interest rate of 2 percent. Dr Yunus argued that this system was meant to encourage responsible handling of the money, since it would have to be paid back to Grameen Kalyan [2].
The Norwegian documentary “Caught in Micro debt” will be released in English in January 2011.
About Muhammed Yunus: Dr Muhammad Yunus is a Bangladeshi banker, economist and Nobel Peace Prize recipient. As a professor of economics, he developed the concepts of microcredit and microfinance. Dr Yunus is also the founder of Grameen Bank, a Bangladeshi microfinance institution. In 2006, Mr Yunus and the bank were jointly awarded the Nobel Peace Prize. Dr Yunus himself has also received several other national and international honors and is a member of several organizations’ Boards.
About Grameen Bank: Grameen Bank is a Bangladeshi microfinance institution that provides collateral-free loans to poor entrepreneurs in rural areas. It was founded in the late 1970’s by Mohammed Yunus, who, along with Grameen Bank, won the 2006 Nobel Peace Prize for their work in developing the concept of microfinance. As of February 2010, it reports 8 million borrowers, 97 percent of whom are women. With 2,563 branches, Grameen Bank provides services to 81,343 villages. Grameen Bank has the equivalent of USD 1.4 billion in assets as of 2009 as indicated on the Microfinance Information Exchange (MIX), the microfinance information clearinghouse.
[1] BD24 News. “Yunus ‘siphoned tk 7bn for poor'” 1 December 2010
http://bdnews24.com/details.php?cid=2&id=180277&hb=5
[2] BD24 News. Letter exchanges between Norwegian Embassy and Grameen Bank.
http://av.bdnews24.com/file/all/Yunus.pdf
Flip the Coin. Information on “Caught in Micro debt”
http://www.flipthecoin.org/?p=301
MicroCapital’s Microfinance Universe profile: Muhammed Yunus
https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Muhammad+Yunus
MicroCapital’s Microfinance Universe profile: Grameen Bank
https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Grameen+Bank
Browse the MicroCapital Universe and add your entry to the wiki at: https://www.microcapital.org/microfinanceuniverse/
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