Professor Muhammad Yunus: New Normalcy, Microfinance, and Grameen America

Professor Muhammad Yunus is the father of microfinance. He founded Grameen Bank in Bangaldesh which has provided microloans to the poorest people without collateral and has garnered a 98%+ loan payback rate. That's pretty good!

Grameen America: Video 1 | Video 2 | Video 3 | Video 4
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Muhammand Yunus highlights/principles:
* However you live, your habits and behavior cannot take away enjoyment from another person (in reference to climate change).
* Who's creditworthy? Almost everybody!
* The new normalcy cannot be the old normalcy else the economic collapse will happen again. We need a redesign.
* Financial apartheid has been practiced on poor people by the banks by not lending to them.
* You can clearly see that in the currently financial crises that banks are not giving loans to businesses forcing them to close. The same thing has been happening to the poor in perpetuity.
* Let's fully develop a person's gift and/or talent. The poor people are poor because they do not get the opportunity to full develop themselves.
* Selfless Business is Social Business. In social business an investment is made and gotten back with no profit. Th goal of th business is to improve people's lives. Some people have a desire to make money while others have the desire to be selfless, hence the need for social business.
* All inputs and outputs must be considered in a social business
* Let's put poverty in the museum

Grameen Bank vs Goldman Sachs:
Grameen has no contracts or lawyers. Grameen takes no collateral. Grameen has a face to face relationship with the borrower. Grameen bank comes to the person to make the loan. Grameen's balance sheet is easy to understand while Goldman Sach's is complicated. (My opinion)Anything that cannot be understood by a high school graduate is bull.

[Video] Professor Muhammad Yunus on Social Business


My thoughts:
The economy is trickle up not trickle down. Whatever profits trickle up should be just that.. A trickle.

Subprime Mortgages:
Why do lenders offer schemes that make payments more difficult? I say either you qualify for a fixed loan or you don't get any loan. Why do you need to offer loans that are not fixed and 5-7% (current going rate)? This is not a spin the roulette, guess what your rate will be in the future, game.

So let me get this straight... You give a loan to less qualifed person (either lower credit score or less income) who will have a hard time paying back the loan. On top of that you attach a higher interest rate, and an adjusting/variable rate to the loan? No wonder the loan will never be paid off! That makes no sense to me. Why do lenders make loans unaffordable and unpayable? You might as well put a self-destruct button in these loans that adjust.

If you want to fund a microfinance loan, you can do so at Kiva.org. You can also provide a loan in India (if you have an Indian rupee based bank account or debit/credit card) by visiting Rangde.org. Rangde.org cannot accept dollars at this time.