An Introduction to Microcredit and the Grameen Bank Bangladesh

An Introduction to Microcredit and the Grameen Bank Bangladesh
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This post is the first in a series, based on my experiences as an intern at the Grameen Bank in Bangladesh in Feb-March 2012.

So how did I get interested in the Grameen Bank?

As I sit in the lobby of the Grand Prince hotel in Dhaka, Bangladesh, I am writing my first post in the series on the Grameen Bank Bangladesh internship. In the last semester of my Masters degree, I became very interested in the concept of microfinance. My interest and curiosity about the concept and its lack of integration with the study of finance and banking, led me to the Grameen bank website, among many other sources of information on the internet.

The Nobel Peace Prize winning (2006) Grameen bank is widely considered as the birthplace of microfinance. The institution was founded in 1976 in the village of Jobra by the Nobel winning Dr. Muhammad Yunus. The organization has considerably improved the status of women in rural Bangladesh by giving them access to microcredit and is largely owned by the borrowers.

Microcredit is an important concept because it is very different from credit offered by the conventional banking system to its clients. This system of no collateral, no guarantee, no loan contracts and easy flexible interest repayments, has been bringing about improvements in the socio economic conditions of the poverty affected in many countries around the world.

I read about the various products and services offered by the Grameen bank on the website and the book by Dr. Yunus, “Banker to the Poor”, which details the story of the creation of the Grameen bank and its founding principles and ideology, and how these evolved over time. I became extremely interested to see how the system works currently, given how the world has changed since the birth of the Grameen Project. I was also curious about microfinance and wanted to know if it interested me enough to consider a long-term career in the field of development. Why not learn about microfinance in the institution where it was first applied?

So I emailed my application to the International Programme Department of the Grameen Bank which offers different types of internships and training programmes depending upon the goals of the applicant. Within 3 weeks, I received an invitation to begin my internship for as long as I liked. I decided on 3 weeks after speaking to a few former interns who felt that time period was enough to learn about the activities of the Grameen Bank. Much to the surprise of my friends and family, and before I knew it, I was on my first solo journey ever, to the crowded city of Dhaka, Bangladesh.

Click here to read about my experience of living in a Bangladeshi village or read my Bangladesh travel blog.

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