Yunus calls on Africa to open up laws for microcedit banks

At the annual microcredit summit in Kenya, Muhammad Yunus said that African laws need to be opened up to allow microcredit banks to operate. Right now on the African continent only non-governmental charities, or the government themselves conduct microcedit loans. Yunus says the laws must allow banks to begin to make small loans to people without collateral just as they do in Asia.

From Reuters South Africa, writer Frank Nyakairu attended the conference.

"To create a new kind of bank, which works with the poor people, we need new legislation but in most of the countries in Africa that legislation has not taken place, so we have left microcredit scenario to the NGOs," Yunus told Reuters in an interview.

Nicknamed the "banker to the poor," Yunus started his movement 30 years ago with a $27 loan to women in Chittagong, Bangladesh.

It has mushroomed and delivered millions of tiny loans to poor people who do not have access to mainstream banking.

"People are ready in Africa there is no problem with the people it's a question of institutional and conceptual arrangement and microcredit could be wonderful social business," he said.

Yunus is attending an annual microcredit summit in Kenya, where Africa's microfinance institutions hope to emulate the success and growth of the industry in Asia, which hosts more than 80 percent of the world's 150 million microfinance beneficiaries.

"African women are very active compared to any women anywhere in the world and micro credits have the best chance of succeeding in Africa particularly in women but the financing is never brought to them," he said.