Microcredit and Woman Power

This year the Nobel Prize for Peace was awarded to a guy closer to home-Mohammed Yunus from Bangladesh. What’s his claim to fame? Well, for one, this guy went ahead and revolutionized banking in a predominantly rural Bangladesh. How did he do it? Woman empowerment silly! You know... the age old idea that women manage money better than men and all…well, he put it to practice.

By championing the cause of Microcredit and lending with a bias towards the fairer sex, Yunus ensured that the money loaned was spent well. It’s an established sociological fact that when women are entrusted with the budgetary strings in a low-middle income scenario, the benefits that result for children are far greater.

According to Yunus, the women were initially reluctant to try out the new schemes, and yet when a small group came on board, the rest of the community followed suit (the guy attributes this phenomenon to the jealousy that ensued, the others simply wanted to copy the women who had succeeded in the credit experiment).

So what’s the lesson to be learnt? (Well, apart from the fact that in some areas women are, unfortunately clearly better) India would do well to emulate this credit model at the rural and BPL levels. Initially in our country all banks have been reluctant to lend in rural areas because of the poor repayment history there.

When banks were nationalized, officials were forced to lend to rural masses, knowing fully well that they would never see their money again! That was more about politics and socialistic idealism than economics, but I guess, now that we’re over the dark ages of banking, it’s time banks considered the lucrativeness of the rural demographics in our country, while carefully placing money in the right hands. You see, it’s all about Woman Power.

P.S. The author is a male and does not happen to be a feminist.