Muhammad Yunus Keynote


[APPLAUSE] Wow, thank you. Thank you, so much. Please. Thank you. Thank you. Thank you. Thank you. What a great honor. It’s a fantastic
morning and after such a glowing introduction is
very difficult to speak now. I hope I don’t disappoint you. And I would like to
start by thanking the State of New
Hampshire for making such a beautiful arrangement, not
only for this conference also The Social Business
Design Competition. It was a fantastic initiation. And people keep telling me that,
if you talk about a business where you say one cannot make
personal profit out of it, nobody will be interested. So I thought there
will be an empty hall. So it shows that it’s not true. People, even when you say you
are not going to make money, still people are interested. That’s a great kind of change
in the usual perception of what people want. The Story of Grameen Bank has
been mentioned in many ways. I never intended
to create a bank. That was not my ambition,
that was not my focus. I was a teacher teaching
economics in the classroom. That’s all I did. But the circumstances
pushed me into a direction, which I could not avoid. And whatever I had done,
it was the compulsion of the circumstances. Not because I
designed some things. Not because I though
about something. It was such a pressing need
in a horrible situation. That you cannot but
jump into things. You don’t have
time to even think. So that’s what I did. And that’s what my first
loan, given to few people. It was a total of $27, began. I was not thinking about
starting a bank or the loan program or anything. Just to protect them
from the loan sharks, I gave the money from
my pocket and said you don’t have to
go to a loan shark. And that was the beginning. And people started
coming more and more. So I kept giving
it from my pocket. But soon, I thought
I will not be able to fill the need of all
the people who are coming to me. So I tried to negotiate things
with the bank, local bank, which is located in the campus. They refused. They said nobody ever heard of
lending money to poor people. It’s impossible. It’s a crazy thing to do. The more they are good,
the more I became convinced that that’s what we should do. So ultimately,
after several months of running around in
the entire banking hierarchy to persuade people. Seeing no way I can open
the door of the bank. So I offered myself
as a guarantor and I said I’ll be a guarantor. I gave my personal guarantee. And if people don’t pay you
back, I’ll pay you back. So formally, I signed
agreement with them. And then as poor women, poor
men take loan in the village, every loan is signed by me. That I’m the guarantor
of this loan. And it works so
well, so beautiful. I merrily kept on
signing, I never stopped. I didn’t worry about whether
they’re going to pay me back. Pay the bank back or not. I said, it’s worth
taking the risk. And ultimately, even the bank
was getting more and more scared that maybe he
won’t be able to pay back if they stopped paying back. Then, I thought I should
create a separate bank. The idea of creating a
separate bank came much later. Begin in 1976. And later, in 1983,
we became the bank. And people asked me,
how did you create this? All these intricate things,
the way you have to lend money, you could persuade
people to pay you back. I couldn’t answer because
everything was done in a hurry. So I was not even thinking
of what I’m doing. Then, I started giving good
explanation, how I did it. I thought it’s a good
explanation anyway. I said, well I never, I
needed a rule or procedure, how to do that, since I didn’t
know anything about banking. I just looked at the
conventional banks, how they do it. Once I find out how they do
it, I just do the opposite. And it worked. [APPLAUSE] First of all, they
go to the rich. More rich you are,
more happy they are. They would like to
give you more money. So I reversed it. I go to the poor. The poorer you are,
more excited we are. If you are the poorest of
all, we get extremely excited. We found her. Conventional banks, go
to men, particularly in Bangladesh, all the money,
all the loans go to the men. We reverse it. We go to women. 97% of our borrowers are women. So that’s another reversal. Conventional banks want to
operate at the city center. At the hub of business district. We reversed it. We go to the village. The remote, remoter the village,
the better it is for us. Even today, after
37 years, we still do not work in any city,
any town in Bangladesh. So if you go to the
capital city, Dhaka, you will not see any
branch of Grameen Bank, or in any other
city in Bangladesh. We work in villages. We work in every single
village in Bangladesh. There are 80,000 villages. And today, we have 8 and
1/2 million borrowers. All women, 97%. Again, conventional banks
are owned by rich people. If you own a bank,
you must be very rich. We reverse that. We made Grameen Bank
owned by poor women. And 8 and 1/2 million borrowers
that I just mentioned, they are the owners of the bank. They sit-in the board, they
make decisions for the bank. Idea of what we do in
Grameen Bank became popular, became known as microcredit
or microfinance. And it’s a global
phenomenon today. But that idea of owning the
bank was not replicated any way. I’m not blaming anybody. It’s because of the
circumstances in which microcredit has to work. It has to work as an NGO. That’s another
complaint I keep making. The complaint is when
you try to create a bank, there is only one law in every
country, called banking law. And banking law allows you
to create a bank, which is actually bank for the rich. There is no law to
create bank for the poor. And I keep saying,
until you create that law, bank for the
poor will never happen. 2/3 of the world’s
population has no access to the banking system,
including the United States. Where do they go? They go to payday lenders,
in the United States. And payday lenders interest rate
is 100%, 500%, 1000%, 2000%, and more. But nobody is interested
to create a bank for them. Because the law
doesn’t permit it. And we are, sometimes, as
you have introduced me, sometimes I’m introduced
as banker to the poor. I said, I’m glad I’m not
introduced as a banker. And I raised the question, if
there was another person who comes from the
banking community, is introduced as a banker, will
it be a correct introduction? I said no, it won’t be
a correct introduction. Because if you call me a
banker, you immediately understand that it will not be
a correct introduction for me. And the banker to the poor
is the right introduction. So with the other
person, he should be or she should be introduced
as banker to the rich. Because that’s what
he or she does. So this, we kind of blurred off. The moment we do it for the rich
as if it is done for everybody. And the poor always misses out. If you do it for the poor,
people will always rub it in. It’s for the poor. It’s always mentioned. And people ask me
or describe, No, the question asked, why do
you lend money to the poor? Why do you learn money to women? Why 97% of your
borrowers are women? In the beginning, I tried
to explain why it is. But now I don’t explain. I only ask, have you
ever asked other banks why they lend money to men? [APPLAUSE] No, I was explaining
the difference between what Grameen Bank
and conventional bank is. How I reversed it. Conventional banks
require collateral. You have to have something
before they will lend you something. And you have to write up, sign
up all kinds of pieces of paper that in case you fail, bank
will grab everything you got. That’s a standard. We got rid of them. We said we don’t need anything. We don’t need any papers. We don’t need any property. Because poor people
have nothing. If you start with the
assumption of property, then you’re not going
to the poor people. So we started with
the assumption that the person
doesn’t have anything. So we don’t have any collateral. How do you lend money to people
who do not have anything? What is the link? Well, it’s a trust. We trust them, they trust us. It’s a relationship of trust. That’s what makes Grameen
Bank, or microcredit so different from the
conventional banks. We can go anywhere,
any time, anybody. We have no problem. And the funny
thing is, it works. Everybody’s, oh,
it will never work. First one we did in
Bangladesh, they said, oh it may work in Bangladesh. It will never
happen in the world. These are crazy
people in Bangladesh. Now, it works globally. We were invited to do
it in New York City. Because there’s
always controversy. It cannot be done in
the United States. My friends Ron and Mary,
they are here someplace. Can you raise hands? Ron Grezinski and Mary
Hilton are right here. Right there. They tried in Chicago. So it’s not something
that it was never done. It’s done. But it didn’t work out the
way they wanted to do it. So they said, oh, see? Even John and Mary
couldn’t do it. The run the South
ShoreBank, in Chicago. If they couldn’t do it,
nobody else can do it. I said, No, it’s not a
question of nobody can do it. It’s a question of doing
it in the way we try to organize it in Bangladesh. So after a lot of these
debates, finally somebody got a little upset and say, why
didn’t you go and do it for us? Show it. You keep saying
that it can be done. I said, I’ll do it. If you give me the
money, I’ll go and do it. So that was done. Somebody offered the money. So here is the money. You can lend this
money to people here. It started in New York City. So in January of
2008, we started a program called Grameen
America in New York City. Today we have six
branches in New York City. We have over 13,000 borrowers. All women, 100% women. Repayment is nearly
100%, it’s 99.4%. No collateral, nothing. And the loan duration
is six months. So you can see how many
six months they have done. Still they kept this near
100% repayment record. In New York City. In all the difficult
neighborhoods of New York City. So many people from other
cities become excited. They said, why don’t you come
and do it for us, in our city? So we went. We went to Omaha, Nebraska. It works very well. It’s running for
the last four years. We work in Indianapolis
another branch. Los Angeles, San Francisco,
Charlotte, North Carolina. Everywhere, the same
result. Total we have lent out over
$102 million already. And we had no,
nothing to regret. And even a movie has
been made out of. It’s a full length movie on what
is being done as microcredit in New York City. [APPLAUSE] So it’s not a
question of Bangladesh or any other country
or a poor country. Today, UK, England, they
want us to start microcredit in their country. So there’s a Grameen
UK already formed and next month, probably, the
whole thing will be launched. Why is needed? Because banking system
never came to that. Always saying it cannot be done. But after all these
years of work, has the banking system changed? No. What do they say? Do they say it cannot be done? No. It’s simply that we are
not supposed to do it. You do it. So they are focused on
something which doesn’t allow the poor people to get in. So all this that we
do with this money, people change their life. And one just quick
mention I would make. There’s something called the
Millennium Development Goal, there are eight Millennium
Development Goals. The first one is to reduce
poverty by half by 2015. And when it was announced
in the year 2000, at the General Assembly
meeting in the United Nations, everybody, they
say nobody will ever help. Reach that goal
or any other goal. It’s crazy. Reduce poverty by half in 2015. Impossible. We were really excited in 2000. Because they came with very
concrete numbers and dates that you have to achieve
this by this year. And we thought,
let’s give it a try. Good news this
year is, Bangladesh has reached that goal
of reducing poverty by half in 2013. [APPLAUSE] 2 and 1/2 years before
the termination date. So it can happen. We keep saying that we must
reduce poverty, bring poverty to zero in Bangladesh by 2030. So then, in Bangladesh, you
cannot find one single person who could be called
a poor person. And then, I said, we
should build a museum. So that next
generation who would like to know about poverty,
since they won’t find it, we’ll lead them to the museum
to see what it used to be. I’m very lucky. This year, United
Nations have declared 2030 is to eliminate
extreme poverty. By that date. And World Bank has
declared that, too. For the whole world. It’s possible. It’s not something, pipe
dream, or something like that. If you put our mind
into it, it will happen. Sometimes I describe a
poor person by saying, it’s similar to bonsai tree. You take the seed
of the tallest tree in the forest and a good seed
and put it in a flower pot. What do you get? You get a tree a
couple of feet tall. Or three feet tall. It doesn’t grow as tall as
that tall tree in the forest. You wonder what’s
wrong with this tree. Why doesn’t it grow
like the one you saw? Is something wrong
with the seed? No, we certified that
we did the best seed. Picked the best seed
and put it there. So it’s not the
fault of the seed. It’s the fault of us, who
put it in a flower pot. We didn’t give the space, we
didn’t give the soil to grow. That’s why it was
growing only this big. And we call it in a very
endearing term, bonsai I said poor people
are bonsai people. There’s nothing
wrong with the seed. Simply, society never
gave them the space to grow as tall as anybody else. They have the same
creative power, they are packed
with same potential as any human being can. Then where did the
society go wrong? Like we build wrong
in institutions. Take the case of banking. Why couldn’t you bank, make a
bank, which is inclusive bank? Nobody’s rejected from it. Street beggars can come
and borrow from me. We lend money to
beggars in Bangladesh. Nobody is denied. We never say, oh, he’s a beggar. Or she’s a beggar. We enthusiastically go ahead and
lend the money to the beggar. And encourage them to carry
some merchandise to sell. As you go from house
to house begging, why didn’t you carry
something with you, so that you can also sell? Some cookies, some candy,
some fruits, whatever. And we make it
sound very simple. You are going there anyway. This is not extra work for you. And people loved that. The joint income bank took
loan $10 loan, $15 loan. And today, they are becoming
a door to door salesperson. Forget about begging,
because people love the service they provide. So that’s the problem. We create an institution
in the wrong way. And said this is the only way. This is not the only way. You’re simply not opening
up and create a situation where everybody can come. And after Grameen and
microcredit being all over the world, you cannot say
banking cannot be done. We do more tougher
banking than anybody else. But it gets done. And people change their life. And good example is Bangladesh. Already has crossed that line. Reducing poverty by
half by 2013, not 15. So what else is
wrong in the system? Our theoretical critical
framework is wrong. What we call capitalism. Capitalism has converted
us into money makers. All we do, we chase money. All our life, we
are chasing money. We have no time to
do anything else. And I keep saying that
we are not robots. We are not money chasing robots. We are human beings. Human beings cannot
behave like robots. But the theory has
converted us into robots. I said I understand. There is selfishness in us. And the entire
capitalist system, the way it has been interpreted
now, is based on selfishness. All are busy to
make things for us. We don’t have time to
look at other people. But there’s nothing
wrong with people. The design of the theory
conceptual framework is wrong. Not the people are not wrong. People have the same
selfishness as anybody else. At the same time, each
person had the selflessness. But theory doesn’t
accept that selflessness. Theory says, oh, if you
want to be selfless, you step outside
the business world. Become a philanthropist
and give away your money. And that’s what we do,
We give away our money. I said, no, I don’t want
to give away my money. I want to use it in the business
world, in a selfless way. How do you do that? I said, I create a business. Business to solve
problems rather than make money for myself. If I become a philanthropist,
if I give some money as in a charity, money goes
it does a wonderful work but it doesn’t come back. To do the same thing, I have to
go and raise the money again. So that I can do it again. And once I’ve done
it a second time, I have to go third time to
raise money to do it again. And sometimes, many of
our organizations who are doing that, it’s a tough job. We spend, in such
situation, we spent most of our time raising money
rather than doing the work. It’s a waste of time. I said, why don’t we create
this whole idea into a business model? And I started
calling it by a name. Calling social business,
that’s what the competition and everything was today. If you can convert this into
a social business, whatever I was trying to do
with it, philanthropy. Then, social business money
goes out, does the work and comes back. And you send it back again. So we can do it million
times it will not run out of money because it
keeps coming back to you. Not only comes back
to you, at each turn it may increase the money. But I have not created that
to make money for myself. I’ve done it so that
I solved the problem. And then started doing that. So if you think that
charity money has one life, social business money
has endless life. That is the power. In Bangladesh, we started doing
this social businesses one after another. We have created many of them. And one, just quick examples, we
have created a nursing college. Bangladesh has a huge
shortage of nurses. There are three
doctors per nurse. You can imagine how
severe the shortages. But the girls are
sitting around, no jobs. I said, what a funny situation. You need nurses. You have girls with
education doing nothing. I said, why don’t we
create a nursing college? And make it a
social business, so that it covers all this cost. So we pick the girls
from Grameen families. Poor families who
have gone to school and have a good education. We picked them up. Grameen Bank gives them
the education loan. Paid all the tuition so the
college covers all these cost. And as soon as
they graduate, they get a very good job
with a very high salary. It’s so easy to
pay back the loan. Our first batch
of graduates just came out, after three years. And immediately,
they got their job. Very high salary job. If they had Master’s
Degree, probably, they would not have that job. So now they’re
merrily paying back. And four of them, we
had graduated 38 of them in the first year. Four of them got a
scholarships to go to England, to do the Master’s Degree. So that’s a social business. This nursing college
will break even, will come to break even by 2016. When it comes to break
even, then the money just keeps coming back. So you can invest this money
to another nursing college and another nursing college. So you have a chain of
nursing colleges going on. That’s social business. We didn’t do it to
make money out of it. We did it to solve the problem. We created an auto
mechanic training college. Again training the young people. Give them loans, student
loans and become auto mechanic and go on business. And we say, you don’t have to
go and work for somebody else. You can be in
business by yourself. And we’ll invest. We’ll become your partner,
as a social business partner. You can pay us back, the
whatever money we gave you, and you’ll be on your own. Our job is to launch
you into business. That’s our social business. So now the idea is spreading
in other countries. Many countries are involved. Facilitating one is Germany. They took it very seriously. One city in Germany,
called Wiesbaden, which is close to Frankfurt. The mayor of the city announced
the city is the social business city. In the beginning, I
didn’t understand. What is a social business city? Because here I am
promoting social business but this guy took
it one step further. So we sat down. He said it’s very simple. The idea clicks me so
well, what you said. And I thought about my problem. As a Mayor, I have
to take care of all the problem of my city, which is
of the richest city in Germany. My city is full of
unemployed people. Single mothers, old people,
criminals, and immigrants, and all kinds of things. And my budget Wiesbaden,
city of Weisbaden, my budget is over one billion
euro, per year. And more than half
of the budget. More than half a billion euro
is spent in transfer payments. Writing checks for everybody. The unemployed, old, single
mothers, and everybody. Whoever, whatever had problem,
I write checks for them. There goes half of the,
more than half of my budget. And the rest of my budget is
to take care of other things. I don’t like that. Every year, that part
becomes bigger and bigger. What you told me
immediately struck me. If social business
can solve problems, these are my problems. That I write checks
for everybody. Can social business solve that? So I thought, why not? So I convened a meeting of
all the businesses in my city. I have 3,652
businesses in my city. I told all the
business owners, look this is called social business. And I would invite you to create
a tiny, little social business, along with your
conventional business. Just a tiny, little. Take care of three,
four unemployed people. Create a social business so that
they can find their own income in that sort of business. This will not hurt
your regular business. But if you do that, three
people or four people that you have taken
care of, I don’t have to write checks for them. And you take care
of single mothers. Two, three, four, five, 10,
whatever number you can. By creating a social business. It’s not giving away money. Your money will
come back to you. But in the meantime,
you created a business. So that these women will
be very happy that now they have something to do. So I like that idea. Said, yes that make sense. Now, it’s growing very strongly. Competing for this,
inviting people, compete with each other. Who can do what kind of
social business and so on. We were invited in Albania,
another European country, to do social business. So we created our usual
social business fund. We start with a fund so that
we can excite everybody. Say come up with ideas,
we have the money. If you have a good
proposal, good project, we’ll invest in your project. We will be your angel investor. And if the project works
out, I’ll get my money back. That’s it. And you have a project. You have a company running. So we start with the fund and
we create a social business incubation company to promote
this idea among the people, among the students. Young people,
businesses, and so on. So when we are in Albania,
as I was in Tirana, I saw a beautiful
office complex. Built by a German
construction company. So we were invited by the
German construction company to show this around and so on. While we were having
lunch together, they said, we have big problem. I said, what is your problem? Our problem is, we had to
bring all the plumbers, all the technicians, all the
electricians from Germany to build this building. Now, it’s all done. It’s finished, so
we are going back. We are handing over this complex
to the government of Albania. And our plumbers, and
technicians, and electricians they are also going back. Our worry, they
said, our worry is who is going to
maintain this complex? If you don’t have
plumbers, electricians, this will crumble
very, very soon. So I suggested, why don’t you
start a vocational training school to train the
plumbers, and technicians, and electricians and so on? Bring your German instructors. Bring your, all the
equipment from there and create these young
people in Albania as good as German
plumbers and electricians. These are not different people. The same people. So if you give
them the training, they will be as good as
your German technician. They liked it. I said, this would
be a social business. You don’t want to
do it for money. You don’t want to because
you feel that this is a something needs to be done. So now that college is
about to begin, in Albania. And I was told in
Tirana that whenever you have 100 people in the
room anywhere in Albania, you’ll get at least 50
lawyers in that group. But not a single plumber. Not a single electrician. And our young people
are looking for jobs. We have high unemployment. But they can’t go to Europe
because we are part of Europe. They can’t find a
job in Europe either. Because they have
unemployment problem, too. So going back to the
theoretical framework, why can’t we add
this social business into the theoretical framework? So there’ll be two
kinds of business in our theory, one
business to make money, one business to solve problem. When business gets involved
in solving problems, no problem can remain unsolved. Because all the technology
that the world has today and it’s growing every
day, every moment. It’s expanding in
a huge, huge speed. Who controls this technology? Business controls
this technology. What kind of use you
make of this technology? You use this technology
to make more money. I said, imagine if you had
the social business idea. Then, we will be using the same
technology to solve problems. And if you use the same
technology, same creative power of human beings, no problem
can ever remain unsolved. And I gave it kind
of a quiz by saying, if you put all the human
creative power on one side and all the human
problems on the other side and let them fight,
who will be the winner? I said, my answer is very clear. Human creative power will
always be the winner. But then why we have
all the problems? Because we are not using
this creative power to solve problems. We said government should do it. We are busy making money. Government doesn’t
have technology. Government doesn’t
have creative power. It’s all with the citizens,
the people who are independent. Who can think things without
the bureaucratic way. That’s what solves problem. So once we put this
into the framework, then the whole world changes. Because as a young
person, as you grow up, you learn, in
economics, that there are two kinds of business. And you have to figure out which
business you should go for. As a person, should I go
for a money making company? I will work for a
money making company? Or should I work for a
social business company? It’s an age old choice. And then you decide. Or should I mix it? Some, I’ll do some part
in social business, some time in a profit
making business? Or I should start
a social business? Or I start a profit
making business, whatever you want to do. Today, there is no option. And that’s why I say we
converted ourselves into robots because we have no option. This one gives option. I’m not saying everybody
has to do this. I said, at least
I have a choice. And capitalism is about choice. But here, it doesn’t
give us a choice. So I’m bringing that choice. So today, the
ideas are spreading as I said, in Albania
in Germany I mention. We, ourselves, directly are
involved in seven countries right now. In Brazil, in Colombia,
in Haiti, in Albania, in India, Tunisia,
Uganda, and so on. And each one has exciting
projects coming up. Because once you go into it,
so many exciting thing comes. Like in Haiti, when I
went there was a forest in Haiti literally disappeared. Only 2% of forest has remained. And I said, why don’t we
create forests for Haiti? Reforest entire Haiti. It’s an exciting
social business. So we created a company. Social business
company, Reforest Haiti. And luckily, we got
very big partners in it. Like Richard Branson
and Clinton Foundation. So we are moving to cover
the whole Haiti with forest. It’s a social business. So there are so
many such options. We have now joint ventures
ventures coming up with many large companies. Like in Bangladesh, we have
joint ventures with Dannon. What we do in this
social business, we produce a special
kind of yogurt to address the problem
of malnutrition among the children
of Bangladesh. Half the children of
Bangladesh have malnutrition. And nothing can be done. So we said, at least
let’s give it a try. So we discussed
with Dannon, who is interested in our social
business idea to create, come up with this idea of
producing special yogurt. With all the
micro-nutrients, which are missing in the
children, into the yogurt. Vitamin, iron, zinc,
iodine and everything. And make it very cheap. So that the poorest
child can afford it. Make it very delicious so that
every child wants to eat it. Because if you put so many
ingredients of micro-nutrients in a small cup of yogurt,
it will taste so ugly you’ll run away from it. But it is the creative
power of business that Dannon to
make it very tasty. Nobody knows that there are
so many medicines in it. And children love it. And now impact is very positive. And we are expanding
that in Bangladesh. So we have joint
ventures with Veolia another big, large
company on water. Bangladesh has a lot
of water problem. Our ground water has
arsenic in our water. Or surface water is polluted. So we are caught. So we created a
small social business as a joint venture with Veolia
to bring clean, safe water for people in the village. But they have to pay. In the beginning, they
were very reluctant. Now, gradually, they got used to
it because they get safe water. And the idea is, company must
get back the expenses covered. So in social business,
owners get back the money. Company has to cover the cost. But owner cannot take more
than what he has invested. That’s it. Rest of the dividend
is plowed back. There’s no dividends. Profit is plowed back into the
company so that you can grow. That’s the simple idea of it. So we have joint ventures with
Adidas, with BSF, with McCain, with Intel
Corporation, and so on. So these are all
details I will skip. But the idea is, it can be done. If we put it in our mind that
this is what we’re going to do, it will happen. And I firmly believe
that if we believe that we can create a
world without poverty, it will happen. And it will happen very soon. Because everything is
moving so fast and because of the technology, because of
the communications, as well. So 2030 is still a long way. In the meantime, so many things
will change you will be amazed. As we see, 15 years
back, what it used to be. At that time, we
could not imagine we will have all the
things we have today. At that time, all
look impossible. Today, it’s all possible. We still don’t have
the Google Glass, yet. God knows what we’ll
have after that. But that’s the
way we are moving. So in that speed, if
you put our destination that this is where we want
to get, we’ll get there. Because nothing will
remain impossible anymore. The possible and
impossible, the distance between the possible and
impossible is shrinking. It’s all a question
of our imagination. If we imagine, it will happen. If we don’t imagine,
it will not happen. So let’s imagine a world where
there’ll be no poor person. Let’s imagine there’ll be
no person in the world who will be unemployed. Why should anyone be unemployed? Is there something
wrong with human being? No. Able-bodied young
person, ready to go. Enterprising, able,
but unemployed. Why? Who punished him? Did the state punish him? Government punish him? No. Who punished him? System punished him. So my question is, should
the system punish people? Or people should
punish the system? It’s a very simple question. If nothing is wrong
in me, who has decided that I should
remain unemployed? System. Nobody else. So we tear apart that
system, which doesn’t fit us. We are not slave to the system. System should be slave to us. To make it happen, the
things that we want. So we can create a
world with no poverty. We can create a world
with no unemployment. And in that age, when you come,
you talk about unemployment. Everybody will look at you. What is unemployment? Can you explain what
is unemployment? Why should anybody
be unemployed? They couldn’t even understand
why all these people who are unemployed before. So stupid of them. And that will be the world
where nobody will line up to get a state charity. Why should anybody
be in charity? Because I can take
care of myself. And it’s possible. It’s a question of
making up our mind and redesign the things
that we have done wrong and do it right. And it will happen. Thank you very much. [APPLAUSE] Thank you. Thank you. Thank you. Thank you. We’re going to do questions. [APPLAUSE] Do you have the questions? Thank you. We’ll have a limited
number of questions. If you please, quickly,
write down your question on a piece of paper and
give it to the volunteers, they’ll bring it to me
and then Professor Yunus will answer those questions. So we’ll give you about a
minute to write the questions. In the meantime, we can start
with one or two questions. Yeah, and whoever writes
fast, you can bring it to me and we’ll start with that one. Lady in the back has the cards OK. Good. OK, you write real fast. OK. We already have a question. Professor Yunus,
what do you think should be the legal structure
for starting social business in this country? Yeah. Legal structure, we keep saying
we don’t need anything new. We don’t need any special
privilege from the government. So we can use the same
company law, as it exists and create social business. Because in social
business is about the me, the owner to decide I’m not
going to take any profit. Government is not involved here. It’s my decision. Nobody forced me to take profit. So I decided, in this company,
I’ll not take any profit. This is the company I
created for this purpose. And I will continue to
pursue that purpose. So government is
not role in that and so far the legal
framework is concerned. The reason we don’t want
to take any privilege from the government
for social business because if government gives
some privilege, in many of the countries the
usual experience is, fake social business
will start growing. To take advantage
of the government. So I said, better
close the door. So let’s go the same way
as any other business does. And we’ll carry
on with the work. So the legal framework
was we are not looking for a new legal framework. We are not looking
for new regulators. Same regulator can
work for us, too. The next question, do
social business owners commit themselves to smaller
living standards or stipends? Again, it is up to you. The definition of
social business is non dividend company
to solve human problems. You can take back
your investment money, nothing more than that. So that about defines
the social business. So how the person
lives or not live, is not part of the social. It’s up to you,
your own philosophy, your own style of life. You decide what you
want to do as a person. But the business
is social business. Provided you decided
not to take any dividend beyond your own
investment money. And it is dedicated to
solve a human problem. Like the problem that we
discussed about single mother, unemployment, poverty, health
care, and so on and so forth. Do you give borrowers
technical assistance support? If so, how much? This, I think, comes from
the microcredit part of it. In microcredit, we
tried to stay away from giving additional service
through the bank window. What we do, we create
separate companies. Like we have created
health care companies to provide health care
to microcredit borrowers. In New York City, we have
the microcredit program, as I explain to you
with 13,000 borrowers right there in New York City. In total, in the USA, we
have 19,000 borrowers. Combining all the cities. But in New York,
there are 13,000. So we have now started,
two information I should share with you. Our first branch in New York
City, Jackson Heights Branch, has come to the break
even point, which is this great celebration. That whole branch, which runs
as a microcredit program, charges 15% interest
in a declining basis. Can cover all its cost
and create surplus. So we have reached that point
in Jackson Height Branch. This is our first branch. And gradually, other branch
will hit that point, too. We have created a whole new
company, called Grameen Primer Care, to provide primary
health care to the borrowers of Grameen Bank. It’s a separate company,
as a social business. Because these are the
people who are not even covered by Obamacare. There are 23 million
people still left who are not covered
by Obamacare. So its an improvement
but still, there are people who are left behind. People who borrow from us belong
to that category of borrowers. People. So we were creating a whole
new health care, primary health care program. Attached to a tertiary
program, secondary program, so that we can take
them to right places. Because today, they don’t know. They appear only as a emergency
room care, which people paid no attention whatsoever. So we want to give them good
community type health care system. Each one is connected
with each one else so collectively, protect
our own health care. And we have health
care coach to help them in to preventive way of
protecting themselves. So we have created those
things as a separate thing. So that each one is independent. Each one is a social business. Is a sustainable business. We didn’t want to
burden the microcredit with lots of other
responsibilities and hike up the price. And people have to pay. So people should have choice. Whether they want
this, or want this, or want this and this as well. Do you believe anyone
can do what you did? Anyone can do what I did. Is it something
terribly complicated? Nothing. Each one, what I
say, anybody can do. And people are going
around doing that. Not every social business I do. Not every microcredit I do. People are doing that. And when I started
in New York City, all I did, send someone from
Bangladesh to do it there. So that he knows, I don’t
have to explain to him. And he did it. And now, it’s expanding in New
York and other cities also. So people figured it out. Once you make up
your mind, there is no, this is not
a rocket science. To create a business,
to employ three people, is it a rocket science? It is not. So why don’t they
create business to employ three people? At least three people. With the intention of not
making myself rich out of it. But to make sure these three
people have decent jobs. And business runs by itself. It doesn’t depend on me anymore. I have created it,
he runs it, I own it. I got my money back. Still it runs it
and still I own it. It is not a rocket science. Anybody can do that. And if I can do, take care
of three unemployed people. Anybody can do it. Three or four or 10
unemployed people. And it is social
business idea if I wanted to take five people
on welfare, out of welfare by creating opportunities
for them, in a business way. So that they no longer have
to belong to the welfare list. They are out of it. And they have this in life. That’s all I have to do. I don’t have to solve the
whole mega-problem of welfare. If I can solve the problem
of five people, 10 people, the problem is solved. Because you created the seed. Once the seed is created,
plantation is easy. It will happen. This question has two parts. What is the role of
philanthropy in social business? Do you think philanthropy will
be replaced by social business? It doesn’t have to be replaced. Philanthropy has
a place and time. So you do not ignore it. But what I go around
telling people involved in foundations,
philanthropy, and so on, to try out, set up, say
10%, of their money. Create a social business fund. And encourage people to
come up with creative ideas so that you can
invest the money. And that fund will
sustain itself. It will continue. Because the rest of the
fund, if you have no infusion of new money, will exhaust. But this money will continue. If you like this one better than
what you did before, you can, from 10%, you can make it
15%, whatever amount you want. But make your start by
isolating, taking off, a chunk of it, say 10%,
of that money, which will be devoted in social business. And then experiment with it. Find out whether it fulfills the
objective of your foundation. Because after all,
you have an objective, why you created the foundation. And these are the
objectives you have. Problem solving, and so on and
so forth, if it does better. And also talk to the government. When they give the
international aid, foreign aid. I said, can you take 10%
of your foreign aid money, in each country, whatever you
do, to go into social business? So that local people,
local businesses become excited about it. And start creating companies
to solve the problem. We are trying to solve
it through the government and through grants and so on. Now, and this money will
come back to that fund. Each year you’ll put
new money, so this fund will become bigger and bigger. And more and more people will
have better and better ideas how to solve this problem. So if you are successful
in 10% of your money, you can increase your
money if you wish. Its up to you but
this is an option. So all the ground facilities,
all the foundation facilities can try out as a separate unit. This is our social
business unit. Thank you. In the US, the cost of higher
education is extremely high. Do you have any suggestion
how this could be restructured so that poor people can
have better access to higher education? First of all, this is a problem. So if there is a problem,
there a social business. So you figure it
out, how to do that. That’s a clear– [LAUGHS] My
way of looking at it like this. I said, we are in a, in the
beginning of a completely new world right now. So we don’t have to think
in an old fashioned way. Education is old fashioned. It needs a new fashion,
new redesigning. Because technology
will make it happen. We don’t need to have a
Harvards, and Barclays, and Cambridge’s, and
Oxford’s, and you name it. We can have one Harvard
for the whole world. Because the same teacher
can teach the whole world. It’s all a question of how
you apply that technology. So that I become a student. I am in a remote
village in Bangladesh but I study in Harvard. I get the same grade,
I do the same exam, I learn from the same
teacher as everybody else. And few years back, probably, it
will look a little bit too far out of the world kind of idea. But today, with the
kind of Conic Alderman. many of you are
familiar Conic Alderman. He’s doing it, a single person. And millions of
students learn from him. So why can’t we have a
institution, teachers like him, in each subject? We’ll pick the
best in the world. Put there. So everybody will learn. Whether you are
the poorest person, poorest child in the family. Or you are the rich son or
daughter of the richest family. It doesn’t matter. We learn from the same teacher. We know the same thing. And we kind of compete
in the same way. Because we learn the same way. So that will really bring
the quality in, people. Otherwise, where I had
education and you had education made us different. And I could have
done the same thing, but I never had the
fortune to go there. And you had the fortune. So we became different. So why can’t we go
to the same school? The whole world goes
to the same school. Today, one of the position that
I’ve been trying to promote and trying to bring it
up, nobody in the world should be illiterate
in this world. Mobile phone can
solve this problem. [APPLAUSE] Simple gadget is a mobile phone. You make it such a
fun thing, learning. With all kinds of,
like you create games. Does anybody teach
game to anybody? They figure it out, right away. Even if three-year-old,
five-year-old figure it out, how to play the game. No manual, nothing. You try to stop him
or stop her, screams. Why can’t we make learning
alphabets or writing to each other in to like a game? Just it’s all designing a
special kind of software. Where grandmother
and the granddaughter will be fighting over
the mobile phone. Who wants to take it because
she wants to send something. Because it’s a fun
thing, it’s not a school. It’s part of my life. I know how to count, I know
how to add, how to divide. And all because I have,
I’m having fun doing that. So that’s the way
it’s really designed. So this is the ultimate. That we are moving
in that direction. But in the meantime, before
we achieve that, I’m sure there are many ways of
solving that problem. It’s a question of
bringing creative idea, how to adjust that. But the fact remains,
all children can be, can get their learning from
the best teacher in the world. The next question
deals with, you mentioned social business
should not be for profit. Is there a middle ground
between the social business and the full profit businesses? You don’t need to have a middle
ground, it’s already there. It’s a kind of a spectrum. On the one side,
you make only money. You don’t think
about anything else. Maximization of profit. And then, gradually,
you shift your position. Some profits, some social. 2% social, 98% profit. And then continue. 50% social, 50% profit. And continue. 98% social, 2% profit. It’s in the spectrum. You come to one stage with
zero profit and 100% social. That’s when we get
social business. But that doesn’t mean that
other point doesn’t exist. 98% social, 2% profit. That also exist. But we don’t call
it social business. We need to have a kind
of a boundary of what we, whatever we define. This is the boundary
for the one where is zero profit and 100% social. So it’s a part of that spectrum. So one can place
himself or herself at any point in this spectrum. I choose 100% profit. I don’t care who says what. It’s OK. It’s your choice. We are not stopping you. Simply say that these are the
options for people to choose. That’s all. Have you ever done
any social business to provide legal assistance? No, we don’t have it. But this is another area
that is a very rich area. It’s not only legal
assistance, also providing technological support. Because one of the big
problem in many countries, like Bangladesh, lend documents,
any ownership documents. It has to be registered with the
government offices and so on. Transferring ownership
from one to one, very complicated process. And only the government
officials have all the records. So they manipulate
those records. You bribe him,
your property will be turned to somebody
else’s property because you put
some money to him. And that kind of thing. So if everybody could keep their
own records, it’s possible. And people say, I
have my own records. I know exactly what
is happening to me. Whether I paid my fee
for the taxes or whatever lend taxes as I have to do. This is a property management,
it’s a very important thing. If you can provide
debt service, legal service a much wider thing. Just saying the property
management service, that will be great. So many things can be done. It is a question of somebody to
design it and getting involved. In India, there are some
NGO’s who are doing that. Providing documents for
your property rights. You can enter the
main server and get all your documents printed out
to the people who need that and keep it as a
printed document. At the same time, they have
it in their computer, too. The next question is,
how do you respond to critics of microlending? Depends on what
is the criticism. Some, I criticize them well. So my criticism is,
we started microcredit as a social business. I didn’t want to make
money out of microcredit. I wanted to have microcredit so
that people benefit from that. The poor people benefit from it. So I made microcredit,
Grameen Bank, to be owned by the borrowers. I didn’t buy one
share of Grameen Bank. I didn’t. So that idea’s taken
up and somebody wants to make money out of that. That is my complaint. Not only wants to
make money, wants to make lot of
money out of that. That’s my complaint. And I say, yes, you can
make a little bit of money. I’m no grudge about that. But don’t take it away
from the original intention of microcredit. I said, your interest
rate is an indicator how much you are taking away. So I said, there should be a
rule of your interest rate. I kept saying there’s a 10%
plus the cost of interest. Whatever, sorry cost of fund. Cost to fund plus 10%. That should be the
ideal interest rate. But if you have a cost
of fund plus 10% to 15%, then you’re in the yellow
zone of microcredit. You’re OK, but
you’re still high. Cost of fund plus 15% and above,
then you are in the red zone. So we complain about that. Don’t take the microcredit
to the red zone. As long as you are in the
green zone and yellow zone, you’re fine. There are many others,
probably, say that. One popular one, oh,
microcredit has not changed anybody anything. It’s a question of, do you
have the eyes to see it? That’s the problem. If you don’t have the
eyes to see it, sorry. You won’t see it. But if you have the right
eyes, you’ll see it. What difference it
makes to these women. In Bangladesh, particularly. If you look what happened
in Bangladesh in the last 30 years, anybody will
see women empowerment is the most dramatic thing that
Bangladesh sees in the last 35 years, 30 years. So that didn’t
come from the sky. Something had to be done,
at the grassroots level, at the ground level, and happen. Bangladesh was at the
bottom of the health care indicators among all the
countries in the neighborhood. India, Pakistan, Nepal,
Sri Lanka and all that. We were at the bottom,
in terms of health care. Today, in 25 years
from now, after that, we have come to the top in
every single health indicator. and it’s because, again,
very strongly related to women empowerment. And it changed the whole
health paradigm in Bangladesh. The last question. How can social business
be effective in terms of improving factory or
working conditions for workers, and particularly, in the export
sector companies, like Walmart and others? We have something called seven
principles of social business. To elaborate, what are the
things we commit ourselves in social business? In the area, this is a,
for example, wage level. The minimum wage
in social business should be above
the minimum wages that is expected around you. So that you are not
hurting anybody to make it a social business. So you pay attention to
the bottom most and so on. And also environment. Like when we are doing
the Dannon yogurt, the first question I asked them. About the container in
which yogurt will be served. They showed me the container. I said it looks like plastic. Said yes, this is plastic. I said in social business,
plastic will not be allowed. They were very shocked. [APPLAUSE] They said, all over the
world we use plastic. I said all over the world, you
are a money making company. But here, in Bangladesh,
you are a social business. So your, all your decision
has to be seen in that light. So they were unhappy. They said, then say
what kind of material you want for this
to replace plastic? I said, simple. Biodegradable material. So they said, we don’t know
anything biodegradable. I said find out. You’ll find out. So they worked for four months. After four months,
the team came back to Bangladesh very excited. They found something
biodegradable. They showed me. Looks exactly like the plastic. And so when I said,
what is this material? Said, it is cornstarch. I said, now, where
did you find it? We found it in China? So are you sure this
is biodegradable? They said, our research
laboratory we tested it in every single way. It passed in every test. So this is biodegradable. I said, that’s good news. Now we can use that. Then I took this cup and
putting towards my mouth, I said can I eat it? He said, why do you
want to eat that? You will be eating the
yogurt not the cup. I said, no. The children should be eating
the yogurt and eat the cup. Said why do you want that? I said, because poor people
will be paying for this cup. And why should you,
why should they pay for the cup who
they have to throw away? Why didn’t you make
it editable cup? And put micronutrients
into the cup, also. Nutrition into the cup, also. So that children will eat
the yogurt and eat the cup. They said, it never
happens like that. I said, in social businesses,
lots of different things will have to happen. So that’s how we explored. And I said, take the
case of ice cream. You have the ice cream
and ice cream cone. You eat ice cream
and ice cream cone. He said but this is not
ice cream, this is yogurt. I said, that’s why
I’m asking you. Otherwise, I will
have my own solution. I don’t have the solution. You have the research facility. You’re scientists
should find it out. So this is how we went. And now because of
that, Dannon tells us that now they have changed
the policy globally. Replacing the plastic cup
with a biodegradable cup. So what happened in Bangladesh,
in tiny little company, had impacted the
major, giant company in addressing their
own issues and so on. It has impacted the company
in more than one ways, in terms of their employees, and
part of their business policies and so on. Because what we have
been challenging them in creating that
company in Bangladesh. Yes, these are the
things we must address. Otherwise, you won’t
be social business. Thank you. I think this is the end of it. Thank you very much. I will appreciate. Thank you. Thank you. [APPLAUSE]

One comment on “Muhammad Yunus Keynote”

  1. 1 / 12 Mandi Sir says:

    A Sage speaks so sacred ! Rare person to come across in this life ! Every word is so pious.. Long live YUNUS !

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