A book to help you better understand microfinance

MicroWorld would like to introduce you to a book that tells you what you need to know about microfinance, written by one of the key founding figures of this new form of finance services: Muhammad Yunus.

Building social business, by Muhammad Yunus

This book, published in 2010, makes easy reading. It takes us inside the Grameen Bank and shows us how social businesses, such as Grameen Danone Foods, created in 2006, were set up. This book, far removed from the old clichés, helps us get to know its author Muhammad Yunus, a true “serial entrepreneur”, who went to war against poverty. As a proponent of creativity and free enterprise, Yunus delivers a fundamental message: a new form of innovative business is possible, social business, which opens the way for capitalism reconciled with humanist values.

“Social business can make profits but investors supporting it don’t make any gains from its activity: they only recover their initial investment after a certain amount of time and absolutely no profit is paid to them in the form of dividends. Any profits made by the business remain within it to finance its growth and create new products or services.”

When he returned to Bangladesh following his country’s independence after the civil war, as professor of economics Muhammad Yunus decided to put a great deal of effort into improving the life of his compatriots. After an initial irrigation project, which failed to benefit the poorest, in 1976 he joined in the microcredit adventure, paying for the first secured loans out of his own pocket! This was followed by a series of pitfalls that lead to many business ventures: Grameen Bank (Nobel Peace Prize in 2006 with its founder), Grameen Phone and Grameen Shakti, for installing solar panels in rural areas. The book also describes in some detail the creation of a unique kind of social business, Grameen Danone Foods, following an amazing meeting in 2005 between Yunus and Marc Riboud, Danone’s CEO & Chairman.

Publisher: PublicAffairs

You can find our feature article devoted to Muhammad Yunus on MicroWorld