Without much chance to get used to living in Dhaka, and believe me it takes getting used to, myself and three other interns were launched into an induction about the bank. Much of the information given, I already knew through reading Banker to the Poor and researching the bank online.
A couple of things caught my attention, however. The most recent figures claim that the bank has 8.4million borrowers throughout Bangladesh. These borrowers are organised into groups of between 5-10 members, with the criteria being that whilst everyone in the group must know eachother well, they cannot be immediate family. If we multiply the number of borrowers then by a (plucked from the air) average family size of 5, the Grameen Bank is helping 42million people in a country of roughly 150million. Amazing. It is no wonder that in recent years the Bank has slowed its growth, with our co-ordinator claiming its infrastructure effectively covers the whole country, and is instead focusing on improving the products it offers.
After learning about the structural organisation of the bank (groups are organised into centres, centres into a branch office, branch offices into an area office and area offices into a zonal office with the head office at the top), we looked at the types of loan offered by the Grameen Bank. The most common is the Basic Loan: a small amount of money, that can increase when the first is repaid, that can be used on any legal profit-making venture. For those wanting to invest in more expensive capital, the Micro-enterprise Loan exists. Both of these can be converted into Flexible Loans, with kinder repayment rates, should natural or personal disaster strike. The Bank also offers Housing Loans, for the improvement of one's home, which has led to the building of 500,000 houses since its establishment. Lastly, the Higher Education Loan (an amazing thing) exists to pay the child of a borrower through university, with repayment only upon graduation. In this way, and a million others, the Bank is instituting real development and social change.
More recently, the Grameen Bank has offered savings accounts. These encouraged good habits amongst borrowers, to save what money is earned, and also provide important capital to the Bank so that it can serve more borrowers. Again, there are a number of different savings accounts here, from a basic current account, to a 'double your money in 7 years', and all forms of terms/interest rates in between. Such savings accounts have not just made the Bank sustainable, but it is even now in profit, meaning it can lend money to other banks in order to generate yet more profit and better serve the poor in the future.
We went into a lot more depth as to how the accounts worked than is shown above. What struck me is the sheer weight of administration. With borrowers depositing maybe 50 taka (not even 50p) each week, it must take a lot of staff/effort to keep on top of everything. Perhaps if the Grameen-style of microcredit was to be replicated in other countries, higher wages and thus a more efficient form of administration may have to be taken into account.
Normally interns have a week in the office before visiting a village served by the Bank, but as it is Eid next week, our visit is tomorrow! Supposedly it's the best bit of the trip, I'm just excited to get out of Dhaka!
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