Yunus urges establishment of microcredit bank to promote entrepreneurship

“A true bank is one that people have faith and confidence in, such as microfinance banks,” he says

Chief Advisor Muhammad Yunus has called for the establishment of a “microcredit bank” to support young entrepreneurs by providing them with collateral-free small loans.

Speaking at the inauguration of the Microcredit Regulatory Authority’s (MRA) new building in Dhaka's Agargaon on Saturday, Yunus said the proposed bank would operate differently from traditional financial institutions, state news agency Bangladesh Sangbad Sangstha (BSS) reports.

“This bank will not be like the conventional ones. The bank will run based on trust and confidence, where collateral is not required to take out a loan.

“Alongside this, a prime target of this bank will be to popularise social business.”

Yunus emphasised the need for laws to establish microfinance banks while highlighting the history of the formation of the Microcredit Regulatory Authority in Bangladesh.

He said, “People are entrepreneurs. We will give them the tools to become entrepreneurs through banks.

“If they get money to invest, people, especially the youth, will be able to start businesses using their own ideas.”

Speaking about the “success of microfinance”, the Nobel laureate said: “None of the microfinance borrowers have stolen money and disappeared, though many banks have.

“Many have vanished with the money taken from the banks. So we must turn to real banks.”

“A true bank is one that people have faith and confidence in, such as microfinance banks.

“MRA is not only serving Bangladesh with microfinance, but other countries around the world as well.”