News & Views
Law &
Jurisprudence
Administrative
Issuances
Trust Products
& Practice
|
Grameen
Bank: |
|
(Article published in the May 17, 2006
issue of Manila Standard Today)
My
OFW daughter Sarah (who up to now enjoys being mistaken for the famous
teen singer) came home last Good Friday for a three-week vacation from her
job at the Royal Bank of Scotland in Edinburgh and gifted me, as her pasalubong, with Muhammad Yunus’ autobiography, “Banker To the
Poor.”
Staying
for just a few years at the land of kilts and bag pipes must have applied
a bit of the Scot on her. The
book was in paperback, obviously previously read through from cover to
cover (by her, I found out later), and with newsprint pages bearing marks
of having been previously dog-eared more than ten times my
granddaughter’s Golden Retriever, Scottie. Like a dutiful Filipino
father, I accepted with great pleasure, carefully not telling her that I
could have picked up a more presentable copy myself at the National Book
Store.
Muhammad
Yunus was a professor of economics at the Chittagong University which is
located in a hilly section of the district from which it got its name,
next to Jobra village, in Bangladesh.
To us outsiders, Bangladesh, with reason, is synonymous with
poverty year in year out. But 1974 was particularly difficult for
Bangladesh; it was a year of the great famine. In the context of this
space and time, Professor Yunus and Grameen Bank began their journey.
Much
has already been written about Professor Yunus and Grameen Bank and I have
nothing to add or subtract from either the man or his vision.
What I have, however, is the opportunity to point to the pages of
“Banker to the Poor” as
the validation of my private theory of incongruity, to wit, that
non-conformity and hard headedness are the parents of progress and
accidents are its yayas.
By
all standards of conventional wisdom, Professor Yanus ought to have simply
occupied a professorial chair in the ivory tower of Chittacong University.
Instead, he dirtied his feet walking the streets of Jobar.
The result was the Grameen Bank that grew, in the short span of
1974 to 1998, from a small pro-poor project in a village near school to
world-renowned multi-billion pound effort against world poverty.
Muhammad
Yunus had neither education nor training to be a banker; he was a
professor of economics, a teacher of that branch of knowledge where it is
acceptable for you to respond with an estimate when someone asks for your
telephone number. But he went
into a lending activity that is almost as tedious as bean counting.
He began the Grameen project in Jobra with absolutely no prior
experience of the pressure of meeting the month’s payroll; but he
succeeded in demonstrating the commercial viability of lending to the
poorest of the poor. Everyone
declared and foretold, as certain as any engineer can mathematically
demonstrate that a bee is aerodynamically incapable of flying, that he
would fail. But he went ahead
anyway, and like the bee, did his thing.
Professor Yanus was, fortunately, hard headed.
He
too broke some norms and some that he broke were sacred tenets to a few of
my holier-than-me colleagues. For
instance, the professor’s early years, as he narrates them, hardly
resemble the American tale of young George Washington and his father’s
cherry tree. On the contrary, they are more like my own unwritten
remembrances of the days of my youth in Gagalangin.
Like all of us book-deprived children of the public elementary school
system in Tondo, Muhammad Yunus, had a need to read and, to satisfy this
need, he admits to having to “improvise, buy, borrow and steal.” At
one time, a children’s magazine, Shuktara, published in Calcutta, listed the names of children who
had won free subscriptions for winning a contest. Young Muhammad Yunus was not a winner but he wanted a
subscription. So, he picked
at random a winner’s name and wrote the publication to say that he had
changed residence. He thus requested that the subscription he had won be
delivered to a new address which was his neighbor’s.
This slight diversion was necessary so his father would not find
out.
This
is the first written admission that I know of of what we now call
“identity theft” and, according to Professor Yunus, “it worked like
a dream.”
Thirst
for knowledge may excuse that bit of deceit; but how about this?
Young Muhammad Yunus, like us public school boys in the late 50s,
liked going to the movies and eating out, i.e. buying from vendors outside
the movie houses. Like boy Yunus, we too did not receive enough pocket
money from our parents.
To
finance his youthful vices, young Yunus worked at his father’s shop and,
during the peak seasons of business, took advantage of his father’s
trust. In his words, “I helped myself to a few banknotes and coins from
the drawer where he kept his loose change.
This embezzlement never amounted to much, but it was enough to
build up a fund to meet my modest requirements.”
This
was the same Muhammad Yunus who founded the Grameen Project, that later on
turned into the Grameen Bank, that was founded on trust and honesty both
of the Bank’s borrowers and workers.
But
all these hard headedness and non-conformity would have been for naught
were it not for the loving care of accidents.
Let us fast forward to how Grameen became a separate bank. Professor Yunus’ admission: “Bangladesh has 120 million
people, but it is sad to say that just a handful of people run things, and
most of them are college or university friends.” Very familiar, isn’t
it?
Professor Yunus had long dreamed of making Grameen a separate
banking institution. Of
course, the government bureaucrats were against it.
But, accidents have a way of twisting fate. Sometime in 1982, he
was in Comilla at the Bangladesh Rural Development Academy to present a
paper on his idea of how the Grameen Bank Project which was then in its
eighth year was go forward. Before
he could make his presentation, General Ershad, without the pretense of a
preparatory declaration of a state of national emergency, simply took over
the reins of government by outright declaring
martial law. The delegates
had to while the time away at the cafeteria since travel was restricted
(in the same vein as our calibrated pre-emptive response) and Professor
Yunus spent his time telling his friend A.M.A. Muhith about his dream.
Muhith,
it later turned out, became finance minister in the new government and
after several months called up Yunus to promise to help give Grameen the
desired status. By the sheer
accident of being in the same place at an unfortunate time, Yunus’ dream
of a separate juridical identity started becoming a reality.
Munith
naturally met strong opposition from within the government but was able to
enlist the help of Mr. Syeduzzaman who had direct access to the President.
By accident, he too was another Grameen admirer.
Mr. Syeduzzaman took the proposal directly to the President.
It is not clear how or even why Gen. Ershad assented, but he did.
Writes Professor Yunus: “When you already have the president’s
approval, it a mere formality to present it in the cabinet which he
presides over and which was created to aid him in discharging his
duties.” Smooth sailing
from hereon, right? Not so
fast; it is so like the Philippines, and a few more accidents were needed.
To craft the new bank’s charter, Professor Yunus enlisted the
help of Dr. Kamal Hossain who played a central role in drafting
Bangladesh’s new constitution. How
did he get the connect? Professor
Yunus had, as a colleague, a former student by the name of Muzammel who
studied at Oxford University at the same time that Hossain was a resident
scholar there. They each other well and were, accidentally, admirers of
Grameen. Hossain drew up a
40-60 ownership structure, the bigger part belonging to the borrowers and
the balance to the government.
As
in everything touched by governments, the final form reversed the
ownership structure, it became 60% government and 40% borrowers.
Professor Yunus, though initially angry, had to accept reality.
Munith promised to restore the original proportions within two
years but resigned in 1985 before he could fulfill his commitment.
Luckily, again, he was succeeded by Syeduzzaman who assured Yunus
that he would stand by Munith’s promise.
Quietly, 75% of the bank became owned by borrowers and 25% only was
retained by the government.
Lack of space constrains me to stop here. But I have no doubts that my thesis of incongruity as the mother of progress is adequately proven. I leave it now to the more famous Sarah Geronimo to sing for me, “ergo stat thesis”. For her and for those of her generation, I wish we had our own Yunus and Grameen bank to sing about.