Special report: Finding entrepreneurs among the very poor

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Editor's note: This is the third in a five-part series on the price of freedom, by exploring the work and experience of Nobel laureate Muhammad Yunus in Bangladesh. Deseret News Opinion Editor Jay Evensen has known Yunus since 1997, when the world leader first visited Utah. Evensen traveled to Dhaka to speak again with Yunus, entrepreneurs, politicians in the country, and even revolutionaries seeking change, to understand the risks Yunus is enduring and why peace and opportunity in Bangladesh are so important to the United States.
GOPALDI, BANGLADESH — To outward appearances, Tulsi Podder is typical of the women I met in the backyard of a home in this rural 'village' of almost 50,000 people about an hour's drive outside of Dhaka, the capital of Bangladesh.
But, in many other ways, she is far different from what you might have encountered here a few decades ago.
She is wrapped in a traditional vivid blue sari. Like the other women at this gathering, her forehead is adorned with a red dot or bindi, paint traditional to Hinduism and other religions. The part of her hair is lined with red sindoor powder, which indicates she is married.
She and many other women have come to make installments on loans through the Grameen Bank, established by Nobel laureate Muhammad Yunus to help the poor become entrepreneurs. Her payment is a 13,000 taka weekly installment on a 500,000 taka loan, the equivalent of $4,100.
I wouldn't have seen anything close to this a generation or two ago, according to K.M. Tipu Sultan, the Grameen Bank senior principal officer who has accompanied me to this gathering. Many of the 75 borrowers in this center — one of 75 centers in this branch — are quietly seated on the ground in front of a table that contains books for recordkeeping. Each one has a story to tell about the steady accumulation of wealth, with many eager to talk about children in higher education.
They gather here once a week, either to make installments on any of a variety of collateral-free loans available to them, or to make deposits into savings accounts.
All are women. Bank officials say women have proven to be far more responsible with funds than their husbands. However, nearly all the women I speak with let their husbands run the day-to-day affairs of the family businesses.
Years ago, no traditional bank would have bothered with these people, especially not with collateral-free loans.
Before beginning, Sultan asks for a show of hands. How many have children who are going to school? How many have used sanitary latrines in the past week? The hands shoot up.
How many have children in college? Many hands go up. Smiles abound.
'This is a transformation,' Sultan tells me.
If the aim is to get people out of poverty, this transformative process involves health and personal hygiene as much as the ability to earn money.
Podder uses the money she has borrowed to expand her business of selling fabrics and clothes she has made. Her first loan, 21 years ago, was for only 5,000 taka, or a mere $41. It has grown steadily since then.
The Grameen Bank is the outgrowth of Yunus' discovery, a half-century ago, that he could improve the lives of the poorest people in his nation by loaning them small amounts of money and placing them in small support groups where they learn the art of entrepreneurship.
Yunus, now known as the 'banker to the poor,' knew no bank would trust its money to such a person, with no credit history and no security. But he saw that ordinary poor people, given the chance, could break free from employers who gave them subsistence wages at the end of a hard day, and be able to work for themselves.
In an interview in the guest house of the compound where he now lives as temporary head of state in Bangladesh, Yunus explains it to me in stark language.
The idea of getting a job stems from slavery, he said. It's the idea that you have to work for somebody.
Oh yes, we've polished it up a bit, he said. 'But it's still slavery. You take orders from somebody.'
This, he said, is wrong. 'Human beings are free persons.' But unless people are given economic freedom, no one really knows who they are.
'That is denied in a job-oriented society. You're an unknown person not only to the world, you're an unknown person to yourself,' he said. As a result, most people go through life never understanding their potential.
'You never got a chance to find out who you are; how much you could have contributed.
'You could have changed the whole world. You're one person who could change the whole world, but you didn't know that.'
He's just as relentlessly critical of the soft bigotry of Western socialism as he is of capitalism's excesses. Rich countries have welfare programs that give people subsistence without letting them grow, he said. 'So, you're hiding poverty.'
People, he believes, should at least have the choice whether to provide for themselves or work for others.
I have watched Yunus explain this to audiences in Utah through the years, including one memorable speech at Salt Lake City's Alta Club. He gets an enthusiastic response to the notion of using capitalist principles to solve societal ills. But his encouragement to focus on people over profits has struggled to gain a foothold.
'Ask yourself, why do people climb Mount Everest?' he asked in that speech. 'Many people do this, even some who are blind or crippled. They risk their lives to do it. Are there stacks of money up there they need to go and get?'
People, he said, can be motivated also by the rewards of helping other people.
'If I make money for myself, I am happy. If I make other people happy, I am super happy,' he said. 'You can do both.'
Now, as head of state, he tells me he wants the world to design a system that allows everyone to stand on their own feet naturally. 'Not only to take care of yourself, but to contribute.'
Grameen — 'rural' or 'village' in Bangla — is the version he designed.
Yunus and his Grameen Bank jointly won the Nobel Peace Prize in 2006 because of this philosophy, and because people such as the women in Gopaldi have shown it can work.
He also received the U.S. Presidential Medal of Freedom in 2009 and the Congressional Gold Medal in 2010.
For more than a half century, microfinance has been copied in many countries. Some reports associate it with an increase in debt and misery, sometimes leading to suicide and other social costs. Yunus is quick to note that these programs do not follow his pattern and often rely on traditional banking techniques and aggressive debt collection. Grameen is all about collaboration, group support and encouragement.
The manager of the Gopaldi branch, Shahid Islam Khan, shows me that this center has a 2% delinquency rate, which is written off. Bank figures show $14.9 million in loans nationwide that are delinquent by between five and nine installments.
But the Gopaldi branch alone also has 107 million taka in outstanding loans that are current, or about $877,000, and more than that — 158 million taka ($1.3 million) — in deposits.
Significantly, the bank offers a variety of products including, on the extreme end, zero-interest loans to beggars — people who, sometimes following generations of family members before them, have subsisted by asking others for money. I encounter several of these who walk up to cars in traffic jams around Dhaka, their hands extended toward car windows.
Sultan said 68% of Grameen borrowers find their way out of poverty, as measured by 10 indicators the bank has established. For beggars, however, only 54% on average graduate from entry-level beggar loans to regular basic loans, and that process can take five or six years.
It is, he said, because of the fierce cultural and familial dynamics that must be overcome. Still, the bank's willingness to help them struggle their way toward entrepreneurship is remarkable. The bank says it has 89,070 members in Bangladesh who qualify as beggars.
Since the inception of the Grameen Bank, $38.7 billion has been disbursed, with $36.4 billion repaid.
The women at this Thursday morning meeting are clearly anxious to impress their American visitors. I am joined by Deseret News photographer Scott Winterton and Salt Lake general surgeon Scott Leckman. We are encouraged to ask questions as the women come to the table to transact their business.
Loxmia Rani Saha, dressed in a bright red sari, smiles as she talks about her children. It is her back yard in which we meet. One of her three children has completed the 12th grade and is now working on a bachelor's degree, she said. She and her husband run an electronics shop in the town square.
When I ask what is her hope for life, Sultan interprets. 'Her children's education will improve their lives,' he said. 'She wishes her children would be educated and will do their own business.'
Pinky Boni is a beautician who smiles like a model as I train my camera on the group. Her hair is neatly parted and styled, and her smartly groomed 12-year-old daughter, Ronopa Bonik, is at her side.
Boni runs her business out of her home, but her plan is to get a shop in the city.
Purnima Sarkar is a goldsmith, and she shows it by the many rings, bracelets and necklaces she wears. She proudly tells me about her son, who is a cricketer and an honor student.
At Grameen headquarters in Dhaka, Grameen Group Chairman Ashraful Hassan discusses what the last 15 years have been like in Bangladesh. Former Prime Minister Sheikh Hasina, deposed last summer in a student-led revolution, was hostile toward the bank and the idea of microcredit and the numerous 'social businesses' Yunus had started in order to improve living conditions.
In 2012, the government forced Yunus off the board of directors under the pretense that he was too old, even though the minister who ousted him was even older. He was forced to exit the Grameen Bank campus entirely in 2020.
The lesson was that, when you live in a country dominated by corruption and poverty, it isn't advisable to try to find a cure for both.
Hassan acknowledges that the Grameen vision was interrupted during those years. Attempts were made to send people to foreign countries to operate remotely, but the government wouldn't permit it.
Somehow, the borrowing and saving continued in places such as Gopaldi. Today, the bank reports 10.6 million members in Bangladesh, with 134,884 centers such as the one we visited.
But there is work to be done to make up for lost time.
As we leave the rural area of Gopaldi, Podder is anxious for us to visit her house, a stately yellow structure with its own temple in the backyard, and to meet her daughter-in-law. She shows us the clothes she is preparing to sell. She beams as we compliment what she is wearing.
'It was difficult for her,' Sultan interprets as I ask what life was like before Grameen. 'As she got loans, it became very good for her to manage the family; to handle the business.'
Today, she puts at least 4,000 taka per month into a savings account. She invests in a family welfare account. Her deposits in one month are almost as much as what she borrowed her entire first year.
'She's happy. You can tell,' Sultan said. I didn't need an interpreter to tell me that.