SKS and Grameen Bank Founders meet up

Vikram Akula, Founder and Chairman of SKS Microfinance of India and Muhammad Yunus, founder of Grameen Bank of Bangladesk, Nobel Peace Prize recipient and author meet for an interview at Clinton Global Initiative this week.  I met Vikram in Hyderabad back in 2005 just as they were transforming from a non-profit to a commercial entity and Unitus Equity Fund was the catalytic investor. Recently, SKS Microfinance floated a successful IPO on the Indian stock market.

This discussion clearly lays out the contrasting perspectives of Vikram and Yunus on their approaches to microfinance.  This is largely about what qualifies as a social business (my perspective) and how best to approach bringing financial services to the world’s poorest.

Overall, if you’ve read my previous posts on Yunus, you’ll know that I am a huge fan on the innovations that he has brought (and continues to bring) to microfinance.  You’ll also note that I am greatly disappointed in his unwillingness to face the realities of the slow growth of microfinance access outside of Bangladesh and how different models are needed in order to accelerate the day when poverty is something we only see in museums (Yunus’ vision.)

In this discussion, he suggests that we should “go slow” with expanding microfinance access until governments create the same banking regulations as in Bangladesh.  This is a luxury the poor do not want and don’t deserve.


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Please share your thoughts in comments.

2 thoughts on “SKS and Grameen Bank Founders meet up

  1. I totally agree with the Dr. Yunus, rushing to set up MFI Bank with IPOs or commercial capital may too early and with a huge risk of MISSION DRIFT. It shall not be the lone responsibility of MFI to finance full continuum of poorest, poor and marginal poor, who lack entries to the commercial capital. MFIs should have clear defined “client” definition. If not there is a risk that more and more non-poor clients will rush in for MFI loan by elbowing out the more vulnerable poorest and voiceless section. The fear here is that MFI might fall in the hands of the profit seekers!! and thus fall in the direction of shifting mission (focus on poor, low interest rate, non-collateral, etc.) .

    Rather Private Banks (licensed) need to include mandate of lending to poor, the budding entrepreneurs (no ability for providing loan security), and relax the regulatory requirement on loan security. As Dr. Yunus said that use of MFI to do something else will danger the MFI movement for poverty alleviation. If experiments to be done it should be not in the name of MFI rather should find a way to use different name.
    /Fahmid Bhuiya, Yangon, Myanmar


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