MUMBAI: You don’t really expect a Nobel Laureate to answer a loud ‘no’ when the Mint photograher’s mobile phone ring tone erupts with a knock, asking ‘anybody there’? “Nobody’s there, right now,” says Mohamed Yunus, sitting in his suite at a budget hotel in Andheri, a Mumbai suburb.
The winner of the 2006 Nobel Peace prize, bursts in to peals of laughter while posing for the photo shoot. His impish grin seems almost illegal for a man who started Grameen Bank in Bangladesh, which pioneered the concept of microcredit, or lending small loans to the poorest of the poor.
Needle Yunus about the irony of a strong credit growth forcing the Reserve Bank of India to raise interest rates four times this fiscal year even as over a dozen Vidarbha cotton farmers committed suicide in a week as they could not pay back small loans and the Nobel Laureate gets angry. “We have been in a 25-year-long struggle with the Indian government on microcredit. When I go for conferences, I always say that we never hear how many people have how much credit. If we find that number, we will probably find that around 2% people control 98% of all credit,” he says.
Yunus, an economics professor, transformed financial principles, when he showed that giving small loans to poor people can be sustainable. He set up the Grameen Bank (GB), in 1976, with just $27 (Rs1,200) to give loans to groups of women, to start businesses. Since its inception, Grameen Bank has lent more than $5 billion to nearly 60 lakh people. It is now a sprawling organization involved in microcredit, home- made fabric, cheap and nutritious food and in giving out loans for setting up cellular phone-booths in villages.
In Mumbai to inaugurate the Grameen Trust’s India liaison office, Yunus says in his speech that just about three crore Indians have access to formal credit. He later corrects that to about 60 lakh Indians who have formal credit. So, he said, fewer Indians get credit than GB customers in Bangladesh.
“This is something to be very worried about. This is a country without enough credit and we need to try different experiments at a policy level to correct this,” said Yunus.
Mumbai’s financial community is treating him like a rock star, on his first trip to India, after his Nobel prize. He is speaking at several major forums and financial sector celebrities, from the public and private sector banks, are keen to meet him. And yet, their failure in expanding credit clearly rankles him.
“Now even the crore has become an insignificant number,” he said, referring to the finances the Tata group raised to buy Corus, to become the world’s fifth largest steel maker. “ All the credit is taken over by rich people and rich corporations. There is nothing left for my paan shop owners and vegetable shop owners.”
“There is clearly a policy problem. There is too much hesitation and bureacracy here,” is all he says about Indian policymakers failing to expand credit and make microcredit as successfull as it has been in Bangladesh.
As an experiment, he suggests setting up one specialised bank in a state for giving outmicrocredit and scaling it up if it works. “You have not even tried this well. Put up this proposal to the government and let them say no.”
But the hectic trip to India has also added to his famous slogan that access to credit is a human right. Vidarbha’s farmers’ suicides are a real example of what he has been telling the world all along, he says.