NO NO

One Bangladeshi bank founder realizes the value in being able to serve underbanked communities freely.

 
 

Muhammad Yunus just wanted to create a bank for the poor. He secured approval from his government in Bangladesh do to just that, only the law prohibited him from serving in urban areas, Newsweek reported recently.

Yunus didn't mind at first. He just wanted to get out into the country and give the unbanked communities access to financial services. But soon, demand for assistance in poor uban communities grew and Yunus realized he was not allowed to help out.

"Once we grew, I realized my mistake," Yunus tells the magazine of his agreeing to the original ban. "There were many people who needed our help but couldn't get to it."

Yunus pushed to get the law to allow him to serve rural areas, but instead the Bangledeshi government, which had the authority to vote him out of his leadership position, removed him from the helm of his bank. And Yunus could help no one.

Yunus would probably welcome the opportunities credit unions have today: the ability to go into poor areas, rural or urban, and target low-income demographics. But, as we wrote in this week's feature article, "Reach Out To Underbanked Communities," many financial institutions in the U.S. are reluctant to go into markets they view as risky and reputation-damaging. However, if they do, they can do so successfully and grow from leveraging an underbanked marketplace.

 

 

 

Oct. 19, 2011


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