• Microfinancingmeans lending small sums of money to the poorin developing countries so that they can invest their small business and come out of the poverty. 5
• Borrowers use the money to buy tools, equipment,etc. (Bamboo to make stools, yarn to weave into cloth, or cows to produce milk.)
• The recipients are poor people who ordinarily are notable to qualify for banking services.
• Typically, the loans are less than $100, often as little as $12.
• Microfinancing was started by the Grameen (means village) Bank founded by economist Muhammad Yanus in Bangladesh.
• In the midst of famine in 1976, he lent$27 to a group of villagers asked him for help. It was a starting point.
• The Grameen Bank has now extended credit to nearly 7 million people.
• The idea has spread, and has been supported by multinational organizations such as IMF or profit banks like Citigroup.
• In total, it is estimated that microfinancinghas reached to 60 million people in the world by 2007.
• It is said that 90% of the recipients of microcredit are women.
• Women’s economic status is found to be strongly related to the well-being of their children, and the key to a healthy householdenvironment.
• For these contributions to society, the UNproclaimed the international Year of Microcreditin 2005.
• Furthermore, Mr. Muhammad Yanus was awarded the Novel Peace Prize in 2006.
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