Opposition, microfinance activists and US senator voice concern over move
The Bangladesh government’s proposal to split the renowned Grameen Bank (GB) into 19 separate organisations with a single headquarters has been greeted with protests. The Bangladesh government plans to split GB into 19 independent registered organisations for better regulation and proper management.
The Bangladesh Nationalist Party (BNP) has voiced its support to Muhammad Yunus, founder of the bank, who has been protesting against the government move. BNP leader Mirza Fakhrul Islam Alamgir accused the government of planning to ruin a successful institution by exercising full control over it. The Bangladesh information minister Hasanul Haq Inu, however, says the government formulates rules and regulations only for public purposes.
Muhammad Yunus, economist and banker, began the Grameen Bank in 1983 to extend credit to people in rural areas. The bank, founded as a statutory body under a law offering ownership to its client members, advances small long-term loans on easy terms to the poorest sections of the society, mostly women borrowers. The bank offers indirect-free credit, or loans with a service tax charged instead of interest. Yunus and his Grameen Bank were jointly awarded the Nobel Peace Prize in 2006 for helping million of Bangladeshis escape the cycle of poverty with small loans. The Grameen Bank model has been replicated in several countries.
Unnecessary intervention
Alok Prasad, CEO of Micro-finance Institutions Network, India, feels the intervention of the government of Bangladesh in the Grameen Bank is unreasonable, and he questions the government’s intentions. “Until and unless there is any complaint regarding the Grameen Bank, such as exploitation of customers or misuse of office, the intervention of the Bangladesh government is not justifiable,” says Prasad. “As far as I know, there are no such complaints against the Grameen Bank. At present, this financial institution is owned by 8.4 million poor women,” adds Prasad.
US senator Rush Holt also issued a statement, warning the Bangladesh government against unnecessary intervention in the Grameen Bank, which has given much needed financial resources to many. “It is past time for the government of Bangladesh to cease its efforts to destroy one of the true economic marvels of our age, Grameen Bank. I call upon Secretary of State, John Kerry, to make it clear to officials in Dhaka that America supports Grameen Bank and its work for the poor in Bangladesh and elsewhere in the world,” says Holt. “If the government of Bangladesh persists in its attacks on the bank and Professor Yunus, our government should reevaluate the wisdom of our current push to deepen political and security ties to the current government,” he adds.
Holt’s statement came after Yunus comdemned the government’s proposal for either a takeover or outright break up of Grameen Bank in a newspaper article last week.
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