Grameen Bank

Grameen Bank Owned by the Poor Grameen Bank at A Glance (1)          Zonal Offices Area Offices Branches Members Total no. of staffs Monthly Disbursement Cumulative Disbursement Cumulative Repaid Amount Total Outstanding : 40 : 258 : 2499 : 7.44 million : 28,000 : US$ 65 million : US$ 6.76 billion : US$ 6.04 billion : US$ 537.19 million Grameen Bank at A Glance (2)        Total Savings Outstanding Loan & Savings Deposit Ratio No. of Telephone Ladies No. of houses built with GB Loan Higher Education Loan Scholarship per year Beggars joined in GB : : : : : : : US$ 758.81 mn 100:141 297,000 651,346 23,096 27,500 98,000 Grameen Bank: New Amendment 24 Feb 2008      Grameen Bank can now work in both rural & urban areas. Government authorized share in Grameen Bank is reduced to 15% from 25% i.e. borrowers share increased to 85%. Actual paid in borrowers share is 94% and the Government share is 6%. Government Representative in Grameen Bank Board reduced to 2 from 3 and borrower Representative increased to 10 from 9. Chairman will be appointed by the Board instead of the Government. Bank may issue bonds and debentures by prior approval of the Government or Securities & Exchange Commission. Percentage of Borrowers Moving above the Poverty on the Basis of GB’s Ten Indicators Year 2001 2002 2003 2004 2005 2006 2007 % Above the Poverty line 42.0% 46.5% 51.1% 55.0% 58.4% 63.6% 65.5% Ten Indicators to Assess Poverty level At the end of 2007, 65.5% GB members crossed the poverty line           Family lives in a house worth at least Tk. 25,000. Family members drink pure water. All children are going to school. Minimum weekly loan installment Tk. 200. Family uses sanitary latrine. Family have adequate clothing, clothing for winter, and mosquito-nets. Family has sources of additional income. Annual balance of savings Tk. 5,000. No difficulty in having three square meals a day. Family can take care of the health. Five Star Recognition Program In 2006 around 2,079 branches (90%) and 12,359 staff (88%) earn one star or more stars. : 100% repayment records for 2 consecutive years (Green Star). : Making profit (Blue Star). : Entire loan program with its own deposits (violet star). : 100% of the children of GB families are in school (brown star). : All the borrowers have crossed over the poverty line (red star) Kamrun Nahar, PIN 19073. She has achieved 5 stars Future Action Plan up to 2015       Membership will reach 15 million (7.44 m achieved). All beggars in the villages will become members of GB (98,000 achieved). Half of the borrowers will have larger micro-enterprise loans (19% have achieved to date). 100,000 medical, engineering and master’s degree will be funded by education loans (23,096). 50,000 scholarships per year (Now 27,500). All branches will be computerized (98% achieved). Diversified Grameen Bank Products & Services Grameen Bank has developed more than 500 income producing uses for loan activities and savings products by focusing on:       Listening to customers and staff. Socially acceptable and income generating capacity. Mentoring - encouraging borrowers to invest in potential sectors. Ownership & risk sharing such as livestock insurance where 50% of the insurance comes from the customers & the remaining 50% from Grameen Bank. Taking care of future needs through Health Insurance, Loan Insurance Savings Fund, Life Insurance. Investing in the Future through Education Loans, Scholarship Program. Grameen Trust Challenges & Solutions to Scaling Up GB Model in different countries       Lack of Legal Framework for collecting and re-lending savings. Inadequate start up funding. If there is funding, Grameen Bank methodology can be implemented through BOT or BOM. Lack of trained human resources can be addressed through training local people such as through BOT. Standard Grameen Bank Products can be introduced such as insurance, savings, housing, and loans for renewable energy technologies. Thin population density can be addressed through targeting clusters or groups of people living together. Women do not take part in income generation, this is a myth rural poor women work as artisans - this can be scaled up. Program/Operation Management of GB: Loans and Other          Basic loan Micro Enterprise loan (Special Larger Investment) Village phone House loan Higher Education loan for member’s children Scholarship program for member’s children Struggling (Beggars) member program Five stars for achievements Computerized MIS and accounting system Basic Loan: Over 500 activities Village Phone 297,000 Telephone Ladies Flexi load Business 1000 Telephone ladies started Flexi Load business Each has avg. additional income Tk.1500 per month Community Information Center     150 centers set up at the rural areas to facilitate internet communication. Browsing, e-mail, downloading results, computer training, CD writing etc. These centers are run by children of GB members. Jointly implemented by GTC with the support of GP. General Housing Situation in Bangladesh       One of the lowest per capita income (US$ 490). Per capita income of bottom half of population is lower. Most do not own any land and other assets. They struggle very hard for physical survival and basic human dignity. Poor protection from monsoon and winter (Poor). Housing material - Jute stick.   Next best thing bamboo for side wall and hay or thatch for roofing. Annual recurring expenditure (US$ 30-40). GB Introduced Housing Loan for the Poor 651,346 houses built     Grameen Bank introduced housing loan in 1984. It became a very attractive program for the borrowers. This program was awarded Aga Khan International Award for Architecture in 1989. Maximum amount given for housing loan is Tk 15,000 (US $ 236) to be repaid over a period of 10 years in weekly installments. Interest rate is 8 per cent.  A total amount of Tk 8.57 billion (US $ 204.9 million) has been disbursed for housing loans. Housing for the Poor: A Vital Investment         Shelter is one of the basic requirements for a person to organize his/her thoughts, discipline for action. Not a Luxury Frill but a source of inspiration. Protection from weather and disease. Land title in the name of women Provides Space and Privacy. Preceded by Incremental Material Development. Vital Investment for the Poor. As a Work Place or Factory. Contrary to existing beliefinvestment in the shelter for the poor is not unproductive. Housing for the poor and housing for rich belong to two distinct categories Housing the Grameen Way      Pre-basic house: Tk. 5000 (US$ 79) - 3 years Basic house: Tk. 5,000-7000 (US$ 79-110) - 3 years Improved basic house: Tk. 7001-10000 (US$ 110-157) - 3 years. Moderate house: Tk. 1000015000 (US$ 157-236) - 5 years Basic housing technology - 4 reinforced concrete cement pillars in the 4 Corners and C.I. sheet roofing on wooden frame.   A sanitary Latrine is a required attachment for every house Housing loan is paid back within a maximum period of 10 years. Higher Education Loan : 23,096 Recipients Higher education loans are given covering tuition, maintenance, and other school expenses for talented children of GB borrowers. Mr. Ramkrishno Saha is the first Doctor (MBBS) through GB Higher Education Loan. Ms. Nurunnahar is the first female Doctor (MBBS) through GB Higher Education Loan. Higher Education Loan: Jan, 2008   Bachelor of Honors : 20,482 Masters Degree : 1106   MBBS : 251 Bachelor of Engineering : 532 Bachelor of Agriculture : 272 Masters of Agriculture : 98 BBA : 318 MBA : 37 Mr. Nasimuzzaman with his mother Nasima Begum (a honorable GB member) completed his Ph.D. & now studying Post Doctorate in USA.     Scholarship Program for talented students of GB members : Over 27,000 children receive scholarships per year  Scholarships are given 60% to girls and the remaining 40% to boys. Scholarships Abroad - Ewha Womans University in Seoul, Korea : Two full scholarships to daughters of GB members for a two year Master Degree Course   Taposhi Banarzee, MotherJharna Banarzee, Champaful Kaliganj Branch, Khulna Zone Razia Sultana, MotherShafia Begum, Rangpur Dumuria Branch, Khulna Zone Every year Ewha Womans University will provide two scholarships for the GB member’s daughters. In 2007 Taposhi Banarzee and Razia Sultana has received the scholarship. Grameen Shikkha: Scholarship Management Program In addition to Grameen Bank scholarship Grameen Shikkha also provide scholarship such as:    Ensure school education of poor rural boys and girls. Assist rural boys & girls to develop their talents. 1924 students received scholarship as of 31 Jan 2008. Financial Management of GB: Savings products have brought financial self-reliance     GB stopped accepting new foreign grant and loan since 1995 Outstanding loan to savings deposit ratio is 100:141 59% of total branches have more savings than outstanding loans Total deposit (Jan, 2008) - Members : US $ 429.55 million (57%) - Non-members : US $ 329.26 million (43%) Total : US $ 758.81 million Savings Products with Balance : Jan, 2008 Description Balance (In Million US$) 255.68 216.76 Grameen Pension Savings (GPS)– (GB Mem.& Staff) Personal Savings (open to all) Double in 7 years-Term Deposit (open to all) Loan Insurance Savings Fund (GB Mem & Staff) Fixed Deposit with Monthly Income (open to all) Fixed Deposit (open to all) Other Fund (GB Members & others) Total758.81 167.22 57.05 33.63 9.45 18.76 Deposit ratio between GB members and non-members : As of Jan 2008 NonMembers 43% GB Members 57% GB members : US $ 429.55 million Non members : US $ 329.26 million Grameen Pension Savings (GPS) Long term growth trend 300 250 200 150 100 50 24.4 0 2001 2002 2003 2004 2005 2006 2007 Jan'08 44.3 67.2 102.1 140.3 (Million US dollar) 256.5 255.7 193.5 Loan Insurance Savings Fund : US$ 8.58 million paid off (Un-repaid loan & interest of deceased borrowers)     Borrower deposits Tk. 30 per thousand for herself and Tk. 30 for the husband. At the death of the borrower or husband, entire outstanding amount of the loan is paid off. If the borrower withdraws her membership from the group she gets back the amount contributed in the fund. Case-1: Highest loan paid off: Tk. 5,43,046 (Husband died, his deposit was Tk. 11,900 in the Loan Insurance Fund.) Interest Rates of Grameen Bank Loan  Savings     Income Generating Loans : Flat rate -10%. Housing Loans : 8% Higher Education Loan :   On study - 0% After study - 5%   For Struggling Members (Beggars) : 0% Center House Construction : 0%    Savings : 8.5% Fixed Deposit : 8.75 - 9.50% Double in Seven Years : 10.40% Fixed Deposit (5 years) with monthly income : 10.04% Fixed Deposit (10 years) with monthly income : 10.67% Grameen Pension Savings (Five Years) : 10% Grameen Pension Savings (Ten Years) : 12% Life Insurance : Families of deceased borrowers of GB received life insurance benefit : 100,402 borrowers died, received US$ 3.93 million  Per deceased family receives Tk. 1,500. Borrowers are not required to pay any premium. 5 4 3 2 1 0 (Amount in million US dollar : Cumulative) 3.32 2.00 3.55 3.71 3.91 3.93  Upto'03 2004 2005 2006 2007 Jan'08 Computerized MIS and Accounting System Staff saves time and improves the quality of their work  Data Management Center at the area level.  97.54% of total branches now have switched to computerized accounting and MIS. GB Struggling (Beggars) Member’s Program Over 98 thousands Beggars Joined. 11,000 given up begging     Existing rules of GB do not apply. All loans are collateral-free. No interest charged. The repayment schedule is flexible.     Repayment installments very small. Begging money is not accepted as installment payments. Can save with GB if they wish. Covered under life and loan insurance without premium. Prof Yunus is talking with former beggars GB Struggling (Beggars) Member’s Program Professor Muhammad Yunus with the Struggling Members of Dhaka Zone Struggling Member Struggling Members are doing business with GB loans. Palli Phone for the Struggling (Beggars) Members Ms Hamisa, Shekerchar, Narsingdi : She was begging before joining GB. First step: She received first loan Tk. 500 for selling stationery goods. 2nd Step: She received Tk. 1000 loan for grocery shop. She also sells cakes (pitha) and earns Tk. 125/130 per day. She has also extended her business by selling rice, guaranteed by GB. She has left begging. Latifa, Damkura Paba Br, Rajshahi : She was begging before joining GB. She received Tk. 500 for selling wool. Now she is in business. Begum, Damkura Paba Br, Rajshahi : She was begging before joining GB. She received Tk. 500 for selling cosmetic items. Now she is in business. Ms. Zamina, Shekerchar, Narsingdi : She was a beggar before. First time she received Tk. 500 loan for grocery item. Second time she started a cookeries goods business by receiving Tk. 1000. She stopped begging. Saimon: Valuka Br, Mymensingh : Begging before joining GB. A 3 dollar loan changed Saimon’s life. Now she is self-sufficient by selling goods. Long Term Vision : Move Out of Poverty More income for women & family:  Basic loan  Micro enterprise loans for bigger investments  Integration of IT & Communications for income generation and knowledge  Build assets to pay for the education and marriage of the children, to enable them to create a large asset base, and pay for other long term needs. And stay out of Poverty Prepare the future generation with education and knowledge so that the families do not slip back into poverty : • • Scholarships Higher Education loan Grameen Kalyan: Health Insurance     35 rural health centres in 5 regions for both GB and Non-GB families. Yearly premium of Tk. 120 per GB family and Tk. 150 per non GB family for different prepaid services. An MBBS doctor is the head of the center. On average the health centers have recovered 85% of the total operational cost. Health Services from Grameen Health Centre E y e C a m p Grameen Shakti : Green Energy for the Rural People Grameen Shakti : Empowering the Rural People with access to Green Energy & Income       Developed an Integrated Sustainable market based Model which has used micro-credit to innovatively bridge the gap between renewable energy technologies and the rural people 400 unit offices and over 1800 staff all over the country. More than 135,000 Solar Home Systems with around 6000 per month benefiting more than 1 million rural people Around 4000 biogas plants to provide cooking gas, light & organic fertilizer. Many plant owners become like mini gas companies (SME). 5000 Improved Cook Stoves to reduce deforestation and protect women's health. Started a Tree Plantation Program Grameen Shakti : Vision for the Future: Road Map to 2015        Set up at least 1000 unit offices and recruit 5000 new staffs. Install one million SHS benefiting minimum 10 million rural people. Construct one million biogas plants. Make 10 million Improved Cook Stoves. Receive CDM benefit for installing one million SHS. Make rural women an integral part of our program by training them to become Solar and Improved Cook Stove Technicians through Grameen Technology Centers. Set up at least 500 Grameen Technology Centers to train Women Technicians and turn them into Energy Entrepreneurs.