Microfinance Case Study Examples

Microfinance has its roots back in the 1970s. Mohammed Yunus has shaped this industry more than any other Microfinance pioneer. While working at the Chittagong University, Dr. Yunus has lent some money to poor women in the village of Jobra in Bangladesh, as an experiment. He was convinced that: “[…] the poor are like Bonsai trees. When you plant the best seed of the tallest tree in a six-inch deep flower pot, you get a perfect replica of the tallest tree, but it is only inches tall. There is nothing wrong with the seed you planted; only the soil-base you provided was inadequate. Poor people are bonsai people. There is nothing wrong with their seeds. Only society never gave them a base to grow on”. (Yunus, M., 2007) Inspired by this experiment he developed “a

Particularly poor women are interested in this kind of services. In the past years 80% of all microfinance clients have been women. Simply by giving them the ability to hold an own bank account, to accumulate savings and to grow a business, they provide development and a better lifestyle for their families. U2 lead-singer and humanitarian advocate Bono is sure that when you "give a man a fish, he'll eat for a day. [But when you] Give a woman microcredit, she, her husband, her children and her extended family will eat for a lifetime".(Hewson, D.P./Bono, 2010) Not only superstar Bono but also the former United Nations Secretary-General, Kofi Annan is convinced, that there is no more effective tool for development than the empowerment of women. (Annan, K., 2005) Microfinance is about more than just helping to improve ones financial situation – for women it is a chance to speak up and stand up for themselves; to become more independent. However microfinance is not a magic bullet but it is in fact a suitable tool to help the working poor to lift themselves out of their current situation, to empower women and to support