Muhammad Yunus works in his modest office in the Grameen Bank tower. The curtains are made of checked cotton produced by weavers his bank supports; so is the blue cotton kurta he wears. The walls are lined with books on economic theory, and he writes in longhand with a fountain pen. Beside him rest a BlackBerry and an iPhone, chiming out when messages arrive.
Weak sunlight leaks in through the smog cloaking the Bangladeshi capital, and the Nobel laureate has an air of serenity. There is no hint in his genial demeanour that he is in the midst of a messy legal battle to keep control of his life’s work.
High on the wall above Prof. Yunus’s chair hangs a portrait: a grainy, black-and-white picture of a serious, spectacled man. He is Sheikh Mujibur Rahman, known as the father of the nation, who led the fight for independence in the early 1970s. He is also the father of Sheikh Hasina Wazed, the woman who leads Bangladesh today – and whose government now seems hell bent on using every possible instrument at its disposal to discredit its most prominent citizen.
At 70, Prof. Yunus might have expected this to be a golden period, overseeing dozens of social enterprises that now bear the Grameen name. Instead he is mired in a bitter feud with the only Bangladeshi with a story to rival his own.
Asked about the cause of his current troubles, Prof. Yunus smiles wearily and ticks off all the “gossips,” and runs through the conspiracy theories. And then he shrugs and lays his broad palms flat on the desk. “I don’t have the slightest idea why this is happening,” he says. “I was just doing my work …”
Beyond the borders of Bangladesh the professor tends to be seen as a naive champion of the poor, persecuted by a jealous Prime Minister. But here in Dhaka, the story is as snarled and chaotic as the streets, alleys and canals below Prof. Yunus’s windows. It’s a story about what Bangladesh is today: a newly vibrant secular democracy with a booming economy – but also, it seems, a country that has not yet shed all the baggage of its messy political past.
The Grameen legend goes like this: in the early 1970s, when Mohammed Yunus was a mild-mannered professor of economics working far from the centre of things in Chittagong, he made a personal loan of $27 to 42 village families. He watched them use the tiny loan to make relatively dramatic changes in their lives, and began to experiment with providing credit to the poor. It was a revolutionary approach; the landless poor had long been considered “unbankable” with no way to obtain capital to start small businesses. Prof. Yunus’s model was formalized as a bank in 1983; today the Grameen Bank has 8.2 million borrowers, and lends $125-million a month.
Grameen lends mostly to women (who, research shows, are more likely than men to repay, and who channel what they earn into the health and education of their families) in small groups, where peer pressure encourages repayment. That model has been exported across the developing world. The work of Grameen is seen as instrumental in sowing the seeds of greater autonomy and prosperity in Bangladesh’s rural women. The 2006 Nobel Peace Prize citation said Prof. Yunus had “shown himself to be a leader who has managed to translate visions into practical action for the benefit of millions of people.”
But microfinance has come under critical scrutiny in recent years, while Grameen’s reliance on foreign donors raised particularly pointed questions at home. Meanwhile the bank – long the most powerful civil institution in the country – has had an increasingly uncomfortable relationship with government as the country moves out of decades of dictatorship.
These troubles burst into public view last fall, when a documentary on Norwegian television alleged Prof. Yunus had, in his role as managing director, improperly transferred funds loaned to the bank by the Norwegian national aid agency to Grameen Kalyan, a separate not-for-profit entity.