Family Bank bid to banish poverty

from The Gulf Daily News

By SOMAN BABY

A NEW Family Bank will enable Bahrain to become the first Arab country to consign poverty to history, Nobel Peace laureate Prof Muhammad Yunus said yesterday.

Founder of Grameen Bank of Bangladesh, Prof Yunus co-signed a memorandum of understanding (MoU) with Social Development Minister Dr Fatima Al Balooshi to establish the Family Bank.

The bank will be set up on the principles and philosophy of Grameen bank, which has been supporting 80 per cent of poor families in Bangladesh with microcredit, over the past 30 years.

"We can create a poverty-free world if we collectively believe in it," Prof Yunus told a Press conference after the signing ceremony held at the ministry.

"In a poverty-free world, the only place you would be able to see poverty is in the poverty museums, and I am confident the new project would enable Bahrain to become the first country to establish such a museum."

Grameen Bank is owned by the poor borrowers of the bank, mostly women.

They at present own 94pc of the bank's total equity.

A team from Grameen Bank would visit Bahrain shortly to work out details of the new Family Bank, said Prof Yunus.

"We are ready to establish it on a Build, Operate and Transfer (BOT) basis," he added.

Prof Yunus described the signing ceremony as a historic moment for Bahrain.

The bank will be established gradually after making an in-depth survey of its beneficiaries, said Dr Al Balooshi.

"We have not yet decided on the capital and the structure of the bank," she noted.

"In 1999, we launched a Microstart project, which gave out loans worth $1 million (BD378,000) to needy families.

"The Family Bank will follow the Grameen Bank concept of making the borrowers its owners."

As the borrowers become the owners, they will ensure that there is no failure in repayment, said Dr Al Balooshi.

"The idea is to shift the needy families from the umbrella of social assistance to social and economic empowerment ," she added.

"About 13,000 families receive regular social assistance from the government."

The micro-credit system of Grameen Bank has changed the lives of millions of poor people, said Dr Al Balooshi.

"We want to learn from the experience of Grameen Bank in enhancing the quality of lives of needy people by empowering them economically and socially," she added.

"His Majesty King Hamad has allocated a social welfare fund to establish a bank for the needy.

"We want to call it a Family Bank, as family forms the nucleus of any society."

The Grameen Bank experience has been adopted by even rich countries like the US and France, said Dr Al Balooshi.

Bangladeshi Ambassador Ruhul Amin said Prof Yunus has become the symbol of hope for the suffering humanity and the deprived people and the destitute.

"The Grameen Bank's mission is to help the poor families to help themselves to overcome poverty," he added.

"In Bahrain, extreme poverty does not exist.

"The proposed Family Bank would lead to some institutional arrangements to assist the disadvantaged families to participate in the country's economic development."

Prof Yunus said the credit provided by the bank is offered for creating self-employment for income-generating activities.

"As a first step to bring information technology to the poor we created a mobile phone company, Grameen Phone," he revealed.

"We gave loans from Grameen Bank to poor women to buy mobile phones to sell phone services in the villages.

"Today there are nearly 300,000 telephone ladies providing telephone service in all the villages of Bangladesh.

"Grameen Phone has more than 10 million subscribers."