Bangladesh’s Grameen Bank and its founder Muhammad Yunus shared the 2006 Nobel Peace Prize on October 13 for lending to the poorest of the poor in a grassroots drive to end world poverty. “Across cultures and civilizations, Yunus and Grameen Bank have shown that even the poorest of the poor can work to bring about their own development,” the five-member Norwegian Nobel Committee said in announcing the award. “Lasting peace cannot be achieved unless large population groups find ways in which to break out of poverty,” it said, adding Yunus’s goal was to end poverty in the world.
“I think this is a wonderful recognition for our efforts at Grameen Bank, and for all the women who work for us and who have made Grameen Bank a success,” Yunus said, expressing his “pride” at winning the prize.
“It will give a significant amount of energy to the whole movement, I can guarantee you that .. this is just the beginning of it.”
Yunus, 66, started the Grameen Bank over 30 years ago, to provide small loans – micro-credit – for the poor.
Yunus and his bank were cited for their efforts to help “create economic and social development from below” in their home country by using innovative economic programmes such as micro-credit lending. Grameen Bank has been instrumental in helping millions of poor Bangladeshis, many of them women, improve their standard of living by letting them borrow small sums to start businesses, reports said.
Loans go toward buying items such as cows to start a dairy, chickens for an egg business, or mobile phones to start businesses where villagers who have no access to phones pay a small fee to make calls. “Every single individual on earth has both the potential and the right to live a decent life. Across cultures and civilizations, Yunus and Grameen Bank have shown that even the poorest of the poor can work to bring about their own development,” the Nobel Committee said in its citation.
Reached by the Nobel Foundation, Yunus was excited about winning the prize. “I’m absolutely delighted. I cannot believe that it has really happened,” he said. “Everyone was telling me that I would get the prize but it came as a surprise. It is fantastic news for the people that have supported us.” Yunus has drawn praise for advancing microcredit, which has been credited with helping poor women to advance their lives and pull them out of poverty. Microcredit is the extension of small loans, typically $50 to $100, to entrepreneurs too poor to qualify for traditional bank loans.
Ole Danbolt Mjoes, chairman of the committee, reportedly said that Yunus’ efforts have had visible results. “We are saying microcredit is an important contribution that cannot fix everything, but is a big help,” Mjoes said, adding that Yunus is a “smart guy. He is creative. His head is in the right place.” Mjoes recounted that Yunus himself lent $27, divided among 42 people, in 1976, to help them buy weaving stools. “Then they got the weaving stools quickly, they started to weave quickly and they repaid him quickly,” he said.
In its citation, the committee noted that “economic growth and political democracy can not achieve their full potential unless the female half of humanity participates on an equal footing with the male,” the committee said. Grameen Bank, which was founded by Yunus, provides credit for “the poorest of the poor” in rural Bangladesh, without any collateral. Yunus and the bank will share in the 10 million Swedish kronor ($1.4 million) prize as well as a gold medal and diploma.