Bangladesh Grameen Bank - Pioneers in Microfinance

The branch office supervised all the ground activities of the bank such as organizing target groups, supervising the credit process and sanctioning loans to members. For every 15-22 villages, a branch was set up with a manager and staff. An area office supervised around 10-15 branch offices. Program officers assisted the area office to supervise the utilization of loans and their recovery.

All area offices were under the purview of a Zonal Office. Each zonal office supervised around 10-13 area offices and all zonal offices reported to the head office situated in Dhaka. Grameen Bank operated on the principles of mutual trust, supervision, accountability and member participation...

From a figure of US $498 in 1976, the bank's total disbursements increased to US $170.39 million in August 2002 (Refer Table II). The loan repayment rate was reported to be 95%. The high repayment rate was probably a result of peer group pressure, and the Grameen Bank's rule - that for availing of fresh loans, earlier loans had to be repaid. Another important factor that led to high repayments of loans was social pressure. When a member failed to repay the installments, other members went to her home and demanded the installments. Creditors' knocking at the door for loan repayments was considered disgraceful among Bangladeshis. It is believed that the above factors led to the success of Grameen Bank which also succeeded in improving the lives of its members...