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Grameen Bank

Grameen Bank, or “village bank,” is an institutional source of microcredit or small-scale finance in developing countries for the very poor and illiterate, who do not have collateral for loans. It is a social business, or a nonloss, nondividend enterprise making nonrecourse loans. It has been created to bring about positive changes in the world without any short-term expectation of making money out of it.

Moneylenders in villages extort money from poor villagers through predatory lending and by swindling them. Institutional commercial banks refuse to lend to the poor because of their lack of collateral. Government interventions in the credit market have been a failure as all initiatives have been usurped by the rich and the powerful, particularly the large and medium farmers, who have collateral, ...

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