Excellencies, Members of the Peace Prize Committee,
Ladies and Gentlemen,
I am overwhelmed by the honour you bestow on me. I record my deep gratitude to you for recognizing our work. Prestigious "Seoul Peace Prize" brings honor and distinction to my work and gives a resounding endorsement at the global level that microcredit for the poor can be a powerful tool to help the poorest person discover his or her own potential to overcome poverty with dignity.
This year we complete 30 years of Grameen's work. When I lent US$ 27 to 42 people in 1976, in a small village next to the university where I taught, I had no idea that it will be the beginning of a new banking methodology and it will spread in every country of the world. It feels very strange to realise that until then we lived with a banking methodology which kept the doors of the banks closed to the two-thirds of world population. Grameen freed banking from the limitations of collateral.
My experience showed me that all the ingredients for ending poverty for an individual comes neatly packaged within the person himself. A human being is born in this world fully equipped not only to take care of himself, but also to contribute in enlarging the well-being of the world as a whole. Then why should one billion plus people on the planet suffer through a life-time of misery and indignity and spend every moment of their lives looking for food for physical survival alone Poverty is not Created by Poor People
First we must understand that poverty is not created by the poor people. Instead it has been created and perpetuated by the economic and social system that we have designed for the world. The institutions and the concepts we developed have created poverty. We see things in the wrong way because of the concepts that we have developed. Our policies, borne out of faulty reasoning and theoretical framework, which we use to explain interactions among institutions and people, has caused this problem for so many human beings. We have to see that it is the failure at the top - rather than lack of capability at the bottom - which is the root cause of poverty.
Beggars Can Turn into Business-Persons
I have long argued that credit should be accepted as a human right. We encourage and support every conceivable intervention to help the poor fight out of poverty. Availability of microcredit to the poor should not discourage or slow down any other interventions. Micro-credit is an intervention which brings better mileage to all other interventions.
Grameen Bank launched a programme to give loans exclusively to the beggars. We invite them to consider carrying some merchandise, when they go out to beg from door to door. They can do both begging and selling at their convenience. If their selling activity picks up, they may quit begging and focus on selling. Over 80,000 beggars have already joined the programme. Typical loan to a beggar amounts to US $ 10.
If a significant number of beggars begin quitting begging, this would be a big demonstration of the inherent capacity of even the beggars, to overcome their problems with their own abilities, if only financial services are made available to them.
Creation of Social Business Enterprises
A principal reason that microcredit has been effective is because it used the market principles to achieve social goals. I have been talking about creating Social Business Enterprises (SBEs) as a new breed of business enterprise whose exclusive goal would be to find solutions to social problems through business.
We need to reconceptualise the business world to make sure it contributes to the creation of a humane society, not aggravate the problems around us. We need to recognise that human beings are not money-making machines. They may feel as excited about solving social problems through business enterprises as they feel about making money. All we need to do is to allow two types of businesses to co-exist and create parallel institutional framework for both of them. These two types of business are: (a) business to make money, i.e. profit-maximizing enterprises (PMEs), and (b) business to do good to people, or social business enterprises (SBEs).
Social business enterprises are a new kind of non-loss-non-dividend enterprises which aim at solving social, health, and environmental problems utilising the market mechanism. SBEs are social-mission-driven enterprises. Their success is measured by their impact on the ground, not by monetary return on investment. For SBEs to make their presence felt in the market place we need to create parallel institutional and policy support structure along with the structure that has been created for the profit-maximizing businesses. One such new institution would be the creation of "social stock market" to bring the social business entrepreneurs and social investors to come in contact with each other and solve the problem of finding investment money for this new type of business.
There are many other things that need to be created, such as, social venture capital, social rating agencies, training of social MBAs, methodology of evaluating successes and failures of the social business enterprises, etc.
Grameen methodology of banking has changed the banking world irrevocably by removing the constraint of collateral. Another change will alter the whole business world fundamentally if we introduce an alternative purpose for business. New option would be to set up business for "exclusively doing good to people". Conventionally there is only one kind of business ¾ business to make money. Now we can offer two options to choose from. Let entrepreneurs decide what kind of business they want to run. Why force them to run only one kind of business
With the economy expanding at an unforeseen speed, personal wealth reaching unimaginable heights, technological innovations making this speed faster and faster, globalisation threatening to wipe out the weak economies and the poor people from the economic map, it is time to consider the case of SBEs very seriously. If we create the right environment, SBEs can take up significant market share and make the market an exciting place for fighting social battles in ever innovative and effective ways.
We can create a Poverty-Free World
I strongly believe that we can create a poverty-free world, if we want to. We can create a world where there won’t be a single human being who could be described as a poor person. In that world, the only place you would find poverty is in the poverty museum. When school children will take a tour of the poverty museums, they would be horrified to see the misery and indignity that human beings once experienced. They would blame their forefathers for tolerating this inhuman condition which existed for so many people for so long.
Conclusion
Grameen has given me a faith, an unshakable faith, in the creativity of human beings. This has led me to believe that human beings are not born to suffer the misery of hunger and poverty. They suffer now as they have done in the past because we turn our head away from this issue.
Each individual human being has much more hidden inside of him/her than we ever have a chance to explore. Unless we create enabling environment to discover the limits of our potential --- we will never have the opportunity to discover what we are truly capable of. Let us create a world where everybody has the opportunity to explore the limits of his/her potentials.
Thank you for honouring me. By honouring me you honour the millions of people who put in the hard work to bring dignity to themselves and to their children, as well as those who are waiting for the opportunity to do so.
Thank you.
