Mr Muhammad Yunus, Nobel Laureate recipient and founder of Grameen Bank, a Bangladeshi microfinance institution which popularized the concept of community lending, promoted a “social business funding” concept to address social problems in Haiti at a recent speaking engagement in Miami, Florida, USA.
The social business fund concept promotes the financing of social businesses which support transportation, housing, energy, health, nutrition and education. A social business fund’s profits are then continually re-invested into the social business. Such a business model concept could assist with Haiti’s post-earthquake recovery, Mr Yunus notes.
States Mr Yunus, “In charity, a dollar only has one life. You use it and it’s done…as a social business, a dollar has an endless life, because it is recycled…This concept is more of a sustainable and enlightened philanthropy. We need to find more creative ways to make use of our philanthropic dollars. Let’s spur entrepreneurship to create jobs and solve social problems.”
By Jennifer Shevock, Research Associate
About Muhammad Yunus:
Mr Muhammad Yunus is a Bangladeshi banker, economist and Nobel Peace Prize recipient. Mr Yunus was previously a professor of economics where he developed the concepts of microcredit and microfinance. Mr 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. Mr 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 Muhammad 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 1.2 billion in assets.
Sources and Additional Resources:
“Social business fund’ proposed for Haiti” August 31, 2010. http://www.miamiherald.com/2010/08/31/1799747/social-business-fund-proposed.html
MICROCAPITAL NEWS WIRE: France: “Father of Microcredit” Laments Unreformed Banking Sector” October 22, 2009. http://www.microcapital.org/news-wire-france-father-of-microcredit-laments-unreformed-banking-sector/#more-3888
MICROFINANCE PAPER WRAP-UP: “Building Social Business Models: Lesson from the Grameen Experience” by Muhammad Yunus, Bertrand Moingeon, and Laurence Lehmann-Ortega” October 15, 2009. http://www.microcapital.org/microfinance-paper-wrap-up-%e2%80%9cbuilding-social-business-models-lesson-from-the-grameen-experience%e2%80%9d-by-muhammad-yunus-bertrand-moingeon-and-laurence-lehmann-ortega/#more-3828
MicroCapital Universe: Muhammad Yunus: http://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Muhammad+Yunus
MicroCapital Universe: Grameen Bank: http://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Grameen+Bank
Browse the MicroCapital Universe and add your entry to the wiki at: http://www.microcapital.org/microfinanceuniverse/