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How Legal Steps Can Help Pave the Way to Ending Poverty |
Wednesday, 24 September 2008
Professor Yunus's Winter 2008 article in Human Rights Magazine is
particularly relevant given the current financial turmoil. In the
article, he discusses the critical role trust – and not complex legal
contracts – has played in Grameen's success. Even though Grameen works
with the "sub sub sub" prime, it does not share the same fate of other
financial institutions around us. The Grameen model requires banker
and borrower to look each other in the eye, to meet regularly and to
build trust. With repayment rates of 98% or better, both here in the
U.S. and in Bangladesh, Grameen's model works.
While Grameen has not had to rely on legal contracts with borrowers to
achieve success, Yunus does see an important role for the legal
profession to play in paving the way for the poor to better help
themselves, including much needed reform to U.S. Welfare and Medicaid
laws and simpler laws that enable microfinance programs to receive
savings deposits. To read the full article, click here .
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