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Nobel Prize Winner Yunus Discusses the Impact of Microfinance

Mohammad Yunus and the Grameen Bank won the Nobel Peace Prize earlier this year for their work in microfinance. The NewsHour's economics correspondent Paul Solman speaks with Yunus about how micro-entrepreneurs improve the overall health of economies.

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  • PAUL SOLMAN, NewsHour Economics Correspondent:

    It was in the early '90s that Muhammad Yunus introduced the NewsHour audience to micro-lending — the idea that won him the Nobel Prize last month — micro-loans to Bangladeshi women of less than $100 each to buy straw to weave baskets, flour to bake biscuits.

    We were reporting on an Arkansas micro-lending program based on Yunus' Bangladesh model, lending to the likes of Jesse Pearl Jackson to buy more hair for her hair-weaving business, and grow the Pine Bluff, Arkansas, economy one small loan at a time.

  • JESSE PEARL JACKSON, Beauty Salon Owner:

    I had attitude. Let's just say it. I had an attitude.

  • PAUL SOLMAN:

    And was it an attitude about yourself or about business?

  • JESSE PEARL JACKSON:

    My attitude was about business.

  • PAUL SOLMAN:

    So every time you have another micro-entrepreneur, you have a little bit more economic growth.

    MUHAMMAD YUNUS, Winner of 2006 Nobel Peace Prize: Absolutely. Because once you have a micro-enterprise coming up, you are allowing your person to show his work and her work.

  • PAUL SOLMAN:

    And allowing the person to show his or her commitment responsibility. Yunus' Grameen Bank, born and still based in Bangladesh, had more than a million borrowers in the early '90s and a loan repayment rate of better than 98 percent.

    When our Fred de Sam Lazaro actually went to Bangladesh to see Yunus and his operation in 2001, the repayment rate was the same, but the number of borrowers had passed two million. And Grameen, owned by its borrowers, had branched out into other businesses, like the country's largest cell phone company, reaching out and touching those long isolated from the larger world.

  • MICRO-LOAN LENDER (through translator):

    We are offering a very good service to the village, and people are very thankful for our phone business.

  • PAUL SOLMAN:

    Moreover, Yunus and Grameen were arguably transforming poverty-ridden, storm-buffeted Bangladesh. No famines there since Grameen began. The birth rate, down by almost half. The borrowers' children, according to Yunus, almost all going to school.

  • MUHAMMAD YUNUS:

    I would say it's about 100 percent enrollment from Grameen families today, and many of them are in colleges, universities coming all the way. So that is very different.