Muhamad Yunus on Creditworthy Poor

Posted by admin on Friday, January 17, 2014

Muhammad Yunus Money Quotation saying banks begin lending with circular logic of creditworthiness validating lending, locking the poor in poverty. Muhammad Yunus said:
 
They explained to me that the bank cannot lend money to poor people because these people are not creditworthy Quote
 

“They explained to me that the bank cannot lend money to poor people because these people are not creditworthy” — Muhammad Yunus

 

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This quote from Muhammad Yunus suggests that traditional banks often deny loans to impoverished individuals and communities due to a perceived lack of ability or guarantee to repay debts.

The best interpretation is that Yunus found this standard practice of excluding the poor from access to credit to be misguided, as it perpetuated cycles of poverty by denying opportunities for self-employment, income generation and economic participation.

By establishing Grameen Bank and pioneering microfinance, Yunus aimed to prove that the poor can be creditworthy if given suitable loan terms, support and recognition of their untapped entrepreneurial potential.

The implication is that Yunus sought to challenge preconceived notions of the poor as inherently too risky to lend to, showing that poverty does not equate to unreliability when financial inclusion is approached through alternative means tailored to marginalized groups’ circumstances and needs.

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