Nobel Prize-winner, Professor Muhammad Yunus, will give a speech in the African Development Bank’s Eminent Speakers Series

TUNIS, Tunisia, March 7, 2013/ – Nobel Prize-winner, Professor Muhammad Yunus, will give a speech in the African Development Bank’s (AfDB) (http://www.afdb.org) Eminent Speakers Series on March 12, 2013 in Tunis. The topic of  Prof. Yunus’ speech, the 19th in the series which began in 2005, will be “Building Social Business in Africa: the new kind of capitalism that serves society’s most pressing needs.”

The speech will be delivered before a distinguished audience of diplomats, representatives of government and civil society, and AfDB staff.

A Bangladeshi national, Prof. Yunus won the Nobel Peace Prize in 2006 together with Grameen Bank, the microfinance lending institution that he founded in 1976 and which became an independent bank in 1983.

The Nobel Committee said it awarded the joint prize to Prof. Yunus and the Grameen Bank “for their efforts to create economic and social development from below.” The professor had been championing the cause for micro-credit since 1975, arguing that poverty was an artificial creation that can be wholly eliminated through human endeavour.

In its commendation, the Nobel Committee added that: “Lasting peace cannot be achieved unless large population groups find ways in which to break out of poverty. Microcredit is one such means. Development from below also serves to advance democracy and social rights.”

Prof. Yunus chairs the Yunus Centre, a resource centre for all Grameen Social Business-related activities in Bangladesh and around the world.

The Centre describes social business as companies “created for social benefit rather than private profit. Like an NGO, it has a social or environmental mission, but like a business, it generates its own revenues to cover its costs. Investors may recoup their investment. All profits are reinvested for growth and innovation, or to seed new Social Business ventures. Social Business aims to expand the current capitalist model by focusing on goals that serve society at large rather than personal profit.”

Prof. Yunus himself says: “A charity dollar has only one life. A Social Business dollar has endless life.”

When  : 12 March 2013, 16h30

Where : Salle de conférence Mohamed Majoul, Amen Bank -Tunis

 

Media Contact : Al Kassoum Diallo ; a.a.diallo@afdb.org

 

SOURCE 
African Development Bank (AfDB)

Bangladesh’s Yunus fears for Grameen Bank future

DHAKA — Nobel prize winner Muhammad Yunus on Wednesday expressed fears that the bank he founded 30 years ago to put his concept of microfinance into practice would be taken over by the Bangladesh government.

Yunus has repeatedly clashed with Bangladeshi authorities and last year he was removed as head of the Grameen Bank, which is credited with lifting millions of people out of poverty through offering small “microfinance” loans.

The government set up a commission earlier this month to review the ownership of the bank and of 54 related social businesses that are still headed by Yunus.

“I believe without doubt that Grameen Bank’s future will be endangered if the government raises its role in the bank by changing its legal structure,” Yunus said in a statement.

“I am now extremely worried about the possibility of Grameen Bank being taken into government control. I fear even to anticipate the course that Grameen Bank will take if it is made a government institution.”

Yunus is seen as one of the world’s leading anti-poverty activists and his sacking from Grameen Bank, apparently on the orders of the government, sparked widespread international anger.

Three weeks ago, US Secretary of State Hillary Clinton heaped praise on Yunus during a visit to Dhaka and called for Grameen Bank’s work to not be undermined as it had helped millions of women.

Supporters say Yunus’s removal was due to envy from the government and came after Yunus previously hinted at joining politics to break a logjam in the country’s bitterly divided political system.

The government’s commission is expected to look into changing the structure of the profitable network of ventures that include Grameen Bank’s multi-billion-dollar stake in Grameenphone.

“Has Grameen Bank committed any major anomalies that required (the government) to set up this probe?,” said Yunus, who was jointly awarded the 2006 Nobel Peace Prize with the bank. “I am saddened at hearing the news.”

Yunus added that borrowers currently owned 97 percent of the bank with three percent owned by the government.

Microfinance loans, which have spread through the developing world, help bring self-sufficiency to many rural families by providing money from small business ventures.

SOURCE: AFP

Bangladesh to probe Grameen Bank and linked firms

From AFP

DHAKA — Bangladesh on Wednesday set up a commission on the future of pioneering Microfinance institution Grameen Bank and 54 related businesses headed by Nobel laureate Muhammad Yunus.

Yunus was sacked as the head of Grameen Bank last year and the new commission is likely to raise fears about further interference in his anti-poverty work, which has earned plaudits around the world.

“The commission will review and recommend the regulatory institution and mechanism of Grameen Bank as to how to bring the bank under the purview of state regulatory agencies,” the government order said.

It will also review “institutions, companies and enterprises established by the Grameen Bank,” the order said, referring to the 54 offshoot businesses which Yunus still heads.

The move comes 10 days after US Secretary of State Hillary Clinton visited Bangladesh and threw her support behind Yunus and asked the government not to undermine Grameen Bank.

The commission was expected to look into the structure of the profitable network of ventures that include Grameen Bank’s multi-billion-dollar stake in Grameenphone.

Despite winning the 2006 Nobel Peace Prize, Yunus was removed from the helm of Grameen by the Bangladesh central bank in a move seen as engineered by an envious government.

Supporters say the step was retaliation after Yunus previously hinted at joining politics to break the logjam in a country bitterly divided for decades between two political parties.

His Microfinance model of giving small loans to help poor, often female, workers has been credited with lifting millions of people out of poverty around the world.

Yunus was in Paris and unavailable for comment, his representatives said.

Professor Muhammad Yunus Featured on Fortune Magazine’s List of “The 12 Greatest Entrepreneurs of Our Time”

From PR Newswire

NEW YORK, April 4, 2012 /PRNewswire/ — Professor Muhammad Yunus, founder of Grameen America and 2006 Nobel Peace Prize recipient, was recognized by Fortune Magazine for his innovative efforts to spur a global movement toward microlending. Considered one of “The 12 Greatest Entrepreneurs of Our Time,” Professor Yunus is credited for his unrelenting efforts to alleviate poverty around the world.

“The global microfinance movement that Professor Yunus has spearheaded is nothing short of revolutionary,” said Stephen A. Vogel, CEO of Grameen America. “As the only social entrepreneur on Fortune‘s list, his efforts have made a profound impact on society and those who need help the most. Professor Yunus’ vision for the United States has enabled Grameen America to continue to grow and empower low-income entrepreneurs to lift themselves out of poverty.”

Included with Professor Yunus on Fortune‘s list of the greatest entrepreneurs were business luminaries such as Steve Jobs, Bill Gates, Fred Smith, Jeff Bezos, Larry Page, Sergey Brin, Howard Schultz, Mark Zuckerberg, John Mackey, Herb Kelleher, Narayana Murthy and Sam Walton.

Proving that microfinance can work in developed countries, Grameen America  is helping thousands of borrowers in the United States living below the poverty line start and run sustainable businesses through microloans. Similar to Yunus’ efforts in Bangladesh, Grameen America creates jobs by providing poor borrowers with access to capital to help them launch and grow their businesses, gain financial independence, and start to build savings accounts.

Fortune‘s list of “The Greatest Entrepreneurs of Our Time” was based largely on social and economic impact; the world changing vision of the founder who has inspired employees and other entrepreneurs alike; record of innovation; and the actual performance of their organizations over time. Fortune notes that Professor Yunus’ idea ‘inspired countless numbers of young people to devote themselves to social causes all over the world.’

About Grameen America
Grameen America, a not-for-profit microfinance organization, has a mission to provide affordable microloans to financially empower low-income entrepreneurs. Founded in 2008 by Nobel Peace Prize recipient Muhammad Yunus, Grameen America has disbursed nearly $40 million in microloans to over 9,000 borrowers. Started in Jackson Heights, Queens, Grameen America has expanded to Brooklyn, Manhattan, Bronx, Indianapolis, Indiana, Omaha, Nebraska and the Bay Area, California. Our vision is to help create a world free of poverty. We create a community where any individual with a dream can receive affordable financial products regardless of income, previous credit history, education, or business experience. We envision a world where burgeoning entrepreneurs are empowered to lift themselves out of poverty through hard work and determination to forge better lives for their families and future generations. www.grameenamerica.org.

Media Contact:
Amy Fathers
CJP Communications for Grameen America
212.279.3115 ext. 209
afathers@cjpcom.com

SOURCE Grameen America

Indian MFIs have deviated from idea of micro credit: Muhammad Yunus

From The Economic Times

MUMBAI: Microfinance institutions in India have deviated from the idea of micro credit, Professor Muhammad Yunus, chairman of Yunus Centre and pioneer of micro-credit, has said.

“They (MFIs) moved away from the idea of micro credit. That has created all the problems,” said Yunus, in a media brefing in Mumbai. “MFIs based in Andhra Pradesh have drifted from their mission.

They need to extract and reintroduce themselves to do business. The problem was created because they called themselves micro credit and deviated from the very plan of micro credit,” he said.

The economist from Bangladesh, who created the innovative programme of providing small loans to poor people, especially women, to help eradicate poverty, said that listing of MFIs on the bourses was a wrong move.

“This is a business done with poor people. So you have to do it carefully. Some people found an opportunity in it and went to benefit themselves. When you want to benefit yourself, sky becomes the limit creating the whole problem,” he said.

The business model that was meant to eradicate poverty in the rural segment and help in financial inclusion has undergone a sea change.

The Reserve Bank of India has come out with guidelines to regulate the micro credit sector after Andhra Pradesh government issued an ordinance restricting their activities.

“Policymakers have to be careful while framing guidelines,” Prof Yunus said. SKS Microfinance, the largest MFI in the country, got listed on the stock exchange in 2010. Other MFIs also wanted to list their shares, but the plan was affected due to changes in market conditions.

Addressing private equity investors, Yunus said investors should pool in money for formation of social business fund without looking for any kind of return. “If investors are ready to part with 1-2% of money, then that money could be used to create parallel social fund without looking for a return,” he said.

The government is likely to introduce the Microfinance Bill in the Budget session of Parliament. The bill will make it mandatory for all MFIs to register with RBI.

Saudi Arabia: Creation of special bank for poor Saudis mooted

By Ghazanfar Ali Khan, Arab News

RIYADH: A Nobel laureate has supported Prince Talal’s idea to create a special bank for poor Saudi citizens at a symposium in Riyadh on Wednesday.

Selling Organs to Pay Off Debt: Microfinance Needs Reforms

By Vishnu Sridharan, New America Foundation

When Muhammad Yunus won a Nobel Peace Prize in 2006 for his work on microfinance with the Grameen Bank in Bangladesh, he would have been mortified to know that a version of his model would one day force his country’s poor into the organ trade. At the time, microfinance (particularly the practice of giving small loans to the unsalaried poor with low to no collateral) was revered for its ability to “do good while doing well.” In other words, it enabled people to escape poverty while turning a profit.

In 2010, microfinance euphoria was dampened when aggressive money collectors drove more than 30 Indian farmers to suicide to escape their debt. Although regulations followed that outlawed such practices, last summer’s revelations of Bangladeshis selling kidneys to pay off loans highlight deeper flaws in microfinance’s traditional approach, and show once again that giving loans to the poor sometimes just exacerbates their plight.

Fortunately, governments and microfinance institutions are taking steps to reform the industry and provide the impoverished with a variety of financial services, including savings options, which better meet their needs. These institutions’ ability to continue those improvements will not only determine microfinance’s future but the well-being of aspiring households around the world.

The desperation caused by debt in Bangladesh makes the need for change even more urgent. When Selina Akter from Berendy village took out loans to start a vegetable farming business, she couldn’t have imagined what it would cost her to pay them back. When her business went through a bad streak, Ms. Akter was unable to meet the required payments and had to take additional loans from another microfinance nongovernmental organization. All told, she amassed 400,000 taka ($5,280) in debt.

As first reported by the GlobalPost in October 2011, to get out from under her loans, Akter had surgery. The 25-year old Bangladeshi received 220,000 taka ($2,676) for her kidney. To cover the rest of her loans, her husband, father-in-law and brother-in-law chipped in. By selling their kidneys. Experts estimate that the Akter family is just one of the many in Bangladesh who get caught up in a “web of loans,” with 250-300 people selling their organs each year for quick cash.

Although no one would deny that microfinance has helped countless entrepreneurial households find their way to self-sufficiency, it’s become clear that in some contexts loans – the traditional focus of microfinance institutions – are not appropriate interventions. As the World Bank’s Consultative Group to Assist the Poor puts it, “Microfinance is…inappropriate for the destitute…. Grants are a more efficient way to transfer resources to the destitute than are loans that many will not be able to repay.”

Even with households that are not destitute, studies show that loans are only helpful as part of a larger package of financial services that includes savings.

In the words of Nathanael Goldberg, director at Innovations for Poverty Action, “Randomized evaluations of microfinance are showing mixed results, with credit clearly not the panacea it has sometimes been made out to be, [and with] savings looking promising.” Last year’s data from this group and others show that the combination of credit and savings is more effective in helping poor households than credit alone.

Luckily, the microfinance industry has not turned a blind eye to this critique. The 2012 State of the Microcredit Summit report, issued ahead of this year’s annual conference in Madrid, states that to help microfinance “recover its soul,” these institutions should “encourage savings.”

Participants at the 2011 European Microfinance Week endorsed the “SMART” campaign, which has as one of its core client protection principles the “prevention of over-indebtedness.” And Mr. Yunus’s own Grameen Bank, more than 20 years after its founding, loosened its rules and allowed savings accounts for clients.

In addition, national governments are stepping up in to help provide financial services to the poor, especially savings accounts that are much less profitable for the private sector.

Earlier this year, Fiji began delivering all government payments to savings-linked bank accounts. In Peru, newly appointed Minister of Social Inclusion Carolina Trivelli announced that all recipients of public benefits will be provided with bank accounts to promote financial inclusion. Similarly, in 2011 Chile launched the “Chile Accounts” program to connect poor household to banks so that they can more easily use government benefits to build wealth.

The organ trade in Bangladesh existed before microfinance came on the scene, and it will likely continue as long as people are in desperate need of funds. At the same time, stories of Bangladeshis selling organs to pay off debt support the growing consensus that the poor are in need of many financial services, including savings, and that loans can harm as much as they help.

Hopefully, with the support of progressive and innovative governments, microfinance institutions will be able to better strike a balance between doing good and doing well.

Is Microfinance Pushing the World’s Poorest Even Deeper Into Poverty?

By Sebastian Strangio, The New Republic

Dhaka—In August, Bangladeshi police broke up a ring of human organ dealers operating in Joypurhat, a district in the north of the country. Investigators say that three local “brokers” preyed on a large pool of indebted farmers, who agreed to part with a kidney or a chunk of their liver for a couple thousand dollars—enough for them to pay down their debts. Mosammat Rebeca and her husband sold their kidneys to help pay back 180,000 taka ($2,358) owed to five separate lenders—a massive sum in a country where the per capita annual income hovers around $1,700. Rebeca’s husband was paid 135,000 taka ($1,768) for selling his kidney last year, but it wasn’t quite enough. “We were about 65,000 taka short, so I had to donate my kidney as well,” she told me in a recent interview.

Rural indebtedness is as old as the earth in South Asia, but what was notable in this case was its source. Instead of the usurious village moneylenders of old, many organ sellers say they were victims of a new, apparently virtuous, engine of economic empowerment—microfinance. While such micro-loan programs have been widely touted as a ladder out of poverty, they had become a crushing burden for many in Joypurhat, who spoke to me of entangling webs of debt and the aggressive tactics of NGO debt collectors. Indeed, stories like the ones I heard in Bangladesh speak to a larger backlash, both on the ground and in the academy, against the practice of offering micro-loans as a tool for international development. While the majority of microcredit institutions are doubtless well-intentioned, in many places an unregulated and overzealous lending market has led to rashes of personal indebtedness and desperation that are a far cry from the development outcomes originally envisioned by experts and donors.

THE PRACTICE OF OFFERING micro-loans as a tool for poverty alleviation has a long and multifaceted history, but most popular accounts begin with Mohammad Yunus’s decision to establish the Grameen Bank in 1976, handing out small loans to impoverished households in rural Bangladesh. In the view of Yunus and other early boosters, access to credit was directly linked to poverty reduction: Granting access to funds at reasonable interest rates would allow the poor to avoid the usurious rates of traditional moneylenders and use the funds to start small businesses and cottage enterprises. In addition, one of Grameen’s key innovations was to target its financial services at women, who bear a disproportionate burden of poverty and are thought to be more reliable financial clients than men. Given the chance, Yunus came to believe, Bangladesh’s rural women could form self-reinforcing networks of trust that would guard against defaults. In short, the poor could be made “bankable.”

Since then, microfinance institutions (MFIs) have revolutionized the field of development, and the global clients of these organizations number in the hundreds of millions. From a narrow focus on credit, MFIs have expanded to encompass a wide range of “micro” financial services, including savings accounts, insurance policies, and skills training programs. Yunus’s Grameen Bank has become an institutional behemoth supporting MFI operations on three continents and hawking everything from mobile phones and knitwear to software and business development plans. In awarding the 2006 Nobel Peace Prize to Yunus and Grameen, the Nobel committee stated that the bank had become “a source of ideas and models for the many institutions in the field of micro-credit that have sprung up around the world.”

But in recent years, microfinance has developed a macro-image problem. Anger has exploded in Andhra Pradesh, India, where journalists and politicians have linked MFIs, including SKS Microfinance, one of India’s largest, to dozens of rural suicides. Opposition came to a head there in October of 2010, when the state government approved an ordinance designed to prevent the “harassment” of small borrowers by debt collectors. Caught in Micro debt, a 2010 documentary by Norwegian journalist Tom Heinemann, turned the spotlight on Yunus and the Grameen Bank, accusing the Nobel laureate of tax evasion—an allegation that was partly used to justify Yunus’ removal as head of Grameen by the Bangladeshi government in March. (Yunus and his supporters deny the film’s allegations.)

Bangladeshi critics say that MFIs have simply acquired too much power and made far too many irresponsible loans, constituting an unregulated shadow state within the country which, far from alleviating poverty, has worsened the situation of the rural poor. “Microcredit is discrimination against the poor, it doesn’t empower. It’s total nonsense,” said Farhad Mazhar, the managing director of UBINIG, a Dhaka-based alternative development organization. According to unpublished research conducted by UBINIG, only around 8 percent of the micro-borrowers surveyed ended up using their loans to build wealth. Even then, Mazhar said, individual success owed more to pre-existing entrepreneurial skills and family support than to the credit itself. “Most of them became poorer,” Mazhar contends.

Skepticism of microfinance and its benefits, meanwhile, has migrated to the academy as well. Lamia Karim, an anthropologist at the University of Oregon and the author of Microfinance and Its Discontents, has questioned the claim that offering small loans directly to Bangladeshi women has been empowering. On the contrary, she has found women are often pressured to hand over loans to their husbands or male relatives. At the same time, microcredit agencies have created what she terms an “economy of shame,” in which the traditional role of women as bearers of “family honor” is used to leverage repayments—a key yardstick of MFIs’ success. (Grameen, for instance, proudly trumpets a loan recovery rate of close to 97 percent). To avoid the public shame of default, many women take out additional loans from different lenders, and quickly find themselves mired in a quicksand of debt.

A heavy emphasis on measuring loan recovery rates also tends to obscure whether borrowers are actually using the loans for productive activities, as opposed to mere survival. When it comes to quantifying the latter variable, one recent report commissioned by the United Kingdom’s Department for International Development and released in August concluded that “almost all impact evaluations of microfinance suffer from weak methodologies and inadequate data.” Given this vacuum of quality research, Maren Duvendack, a research fellow at the University of East Anglia and one of the report’s authors, says the verdict on microfinance is still out. “I’m surprised microfinance has been hyped up so much,” she told me, “because good impact evaluations are still pretty scarce.”

Nigeria: Association seeks to re-position Microfinance banking in Nigeria

By Ebele Orakpo, Vanguard

WHen Professor Mohammad Yunus founded the first microfinance bank (MFB) called Grameen Bank in Bangladesh, his aim was to eradicate poverty by empowering the rural poor through loans. The first principle of microfinance banking is that the bank should go to the people.

At the last Impact Conference series organised by the First Bank of Nigeria where Professor Yunus delivered a keynote address, he noted that what we have in Nigeria is not microfinance banking but micro commercial banking.

This deviation from the original principle was probably what caused the near total collapse of microfinance banking in Nigeria. Micro-finance banking was introduced to provide a platform for the under-banked segment of the economy that may not be able to meet the stringent requirements of the conventional banks. It was incorporated into the Nigerian financial system as a way of alleviating poverty. It was to promote entrepreneurship through micro lending especially to the poor and economically disenfranchised.

In a bid to stem the tide and also debunk recent assertions that Micro-finance banking has failed in Nigeria, the Association of Micro-Finance Banks, Lagos Island Chapter is embarking on a campaign to showcase their achievements. The first in the series of events is slated for November 24 at the Southern Sun Hotel, Ikoyi, Lagos at 8am.

The campaign, according to a Press release by the organisers, has as theme: Micro-finance is Working and incorporates a series of strategic events that will showcase the contributions of MFBs on Lagos Island to the socio-economic development of the country.

The organisers noted that “Micro-finance banks encounter an overwhelming array of regulatory constraints which the CBN can address in their policy reform work. MFBs as presently constituted, are less inclined to engage in policy advocacy work because they lack resources, experience and cohesion.

“The association has, in spite of numerous challenges, recorded considerable success even as they struggle to grow in an uneven playing field and increasingly stifling environment. However, there are challenges that increasingly threaten to erode these successes and inhibit future growth.”

According to the release, the event will feature interactive sessions combining presentations, field reports, future plans, as well as real life cases from experts and practitioners.

“The events which will seek to highlight the importance and role of MFBs in a cashless economy, will also strive to convince industry regulators, stakeholders and other participants of the strategic and indispensable importance of MFBs in the quest for poverty eradication

AGFUND in spotlight as Microcredit campaign widens reach

From Arab News

JEDDAH: More than 137.5 million of the world’s poorest families received a microloan in 2010, an all-time high, according to a report released by the Microcredit Summit Campaign.

Assuming an average of five people per family, these 137.5 million microloans affected more than 687 million family members, which is greater than the combined populations of the European Union and Russia.

Microloans are used to help people living in poverty in both industrialized and developing countries to expand a range of small businesses, such as selling products in a local market, making clothes, and providing computer and other business services in rural areas.

The report’s release precedes the Global Microcredit Summit 2011 to be held Nov.14-17 in Valladolid, Spain, which will be inaugurated by Queen Sofia and Nobel Peace Prize laureate and Grameen Bank founder Professor Muhammad Yunus.

“At the first Microcredit Summit in 1997, only 7.6 million of the world’s poorest families had been reached,” said Yunus.

“While the growth in numbers has been inspiring, we must keep our attention on the wisdom from the clients. The report tells us that when asked what they want for themselves and their families, their answers include, ‘education for their children, health for their family, decent housing that keeps the rain and cold out, and regular, nutritious meals.’ This is what we will pursue when we gather at the Microcredit Summit in Valladolid.”

While more than 205 million people worldwide received a microloan in 2010, this multi-year campaign focuses on outreach to the poorest clients.

According to the report, over the last 13 years, the number of very poor families with a microloan has grown more than 18-fold from 7.6 million in 1997 to 137.5 million in 2010.

The latest data comes from more than 3,600 institutions worldwide, with more than 94 percent of the information having been collected within the last 18 months.

However, microfinance faced setbacks as well last year.

An initial public offering of SKS, a microfinance institution (MFI) based in Andhra Pradesh, India, was followed by charges of over-indebtedness and suicides among clients in that state, resulting in a clampdown by the state government last October.

“While our progress has been stunning, the challenges in Andhra Pradesh and elsewhere will take a toll,” said Campaign director Sam Daley-Harris.

“As of August 31, 2011, when this report was completed, the situation in Andhra Pradesh had not yet improved, and repayment rates of MFIs there were reported as low as 10 percent. Were we, therefore, to deduct 90 percent of the Andhra Pradesh numbers from our calculation of clients reached, we would see nearly 200 million total clients and more than 132 million poorest clients reached in 2010. This represents more than 5 million clients who received loans in 2010 but may not receive loans in 2011.”

The report also highlights the number of poorest women reached.

Not only have these women been the most excluded from traditional banking, but they are also the ones most likely to ensure that the increased income is used to improve the lives of their children. From 1999 to 2010, the number of poorest women reached has increased from 10.3 million to 113.1 million.

The report was released in Valladolid at a non-governmental organization fair held as a prelude to next week’s Global Summit.

The State of the Microcredit Summit Campaign Report 2012 sets the tone for several of the more than 100 sessions scheduled for the Global Summit.

Top leaders in the areas of client protection, social performance, interest rate transparency and financial inclusion have written papers for the summit.

The report discusses one of the central plenary sessions at the summit, focusing on the continued development of a Seal of Excellence for Poverty Outreach and Transformation in Microfinance.

The seal of excellence has been under development for 19 months and will continue to evolve with input from a broad range of stakeholders.

It will recognize those institutions that deepen financial inclusion by providing products and services that reach poor people and support their movement out of poverty.

The seal of excellence will build on other microfinance industry initiatives, including the smart campaign’s client protection principles and the universal standards of the Social Performance Task Force.

The steering committee for the seal of excellence plans to use the existing social rating and evaluation systems to assess the performance of microfinance institutions in poverty outreach and transformation.

“As a microfinance community, we need to shift our focus from outreach to results,” said Larry Reed, incoming director of the Microcredit Summit Campaign.

“The state of the Microcredit Summit Campaign Report 2012 outlines important steps that we can take together to insure that the financial services we provide result in regular meals, secure housing, uninterrupted education, and better health for our clients and their families.”

In view of the targets that intend to eliminate poverty, specifically speaking in the less fortunate developing countries, as well as reaching the weak categories represented in women, children and disabled people, the Arab Gulf Program for Development — the pioneering organization in the field of supporting the continuous human development along side with focusing on poverty (agfund.org) and chaired by Prince Talal bin Abdul Aziz has responded in a very practical way to the millennium’s prior development objective, one that was called for by the global millennium summit organized by the United Nations and attended by the world’s country leaders, in September 2000.

AGFUND achieved this via developing its strategy by adopting the support of the microcredit activities as a priority in its financing operations throughout the past nine years.

AFGUND has actually succeeded in accomplishing a lot to support this objective and meet its requirements via supporting about 97 microcredit institution in developing countries, backing the regional conferences held specifically whether in Africa or the Arab world, specifically speaking the Africa-Middle East microcredit conference, that was held in Amman, Jordan in October 2004, with the participation of the microcredit summit.

AFGUND has established four banks and institutions specified for the poor in each of Jordan, Yemen, Bahrain and Syria and these banks are considered the most prominent in the Arab region.

Al-Watani Bank for financing small projects in Jordan has managed to cover its operational costs in yet less than one year from the date of commencing its operation.

Additionally it succeeded in acquiring trade loans in the first year without any securities.

In the year 2011, it launched the product of ‘ Heath Insurance Bank” to serve the poor and it is the first of its kind in the whole Arab region.

Likewise, Al-Amal bank in Yemen is the first bank in the Arab region that offers all the financial services to the poor (loans, savings, insurance) and it managed throughout its short span to win global awards in providing products for the adults and Islamic products. It also gained the appreciation of specialized bodies in the field of performance and transparency.

The number of beneficiaries from these banks has reached one million and that AGFUND actually targets five million people to be benefited by the year 2015 through the loans provided by the banks poor that it has established.

The Microcredit Summit Campaign aims to reach 175 million of the world’s poorest families by 2015 and ensure that 100 million of those families move above the World Bank’s $1.25-a-day poverty threshold.

The campaign is a project of RESULTS Educational Fund, a US-based advocacy organization committed to creating the will to eliminate poverty.

The campaign was launched in 1997 and in 2007 surpassed its original goal of reaching 100 million poorest families with credit for self-employment and other financial and business services.

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