Chapter 5: Power of Collectives in Combatting Resource Poverty: A Case Study of Grameen Bank in Bangladesh

Grameen Bank in Bangladesh is a collective initiative that is aimed at providing the access to microfinance at the bottom of the pyramid. The people at the bottom of the pyramid do not have access to collateral and thus are unable to obtain finance. Mohammed Yunus in Bangladesh highlighted the importance of group lending through the social capital on the well-being of the people. Through Grameen Bank, the semi-formal financial institution emphasized the importance of promoting the financial welfare among the people at the bottom of the pyramid. The chapter highlights the importance of Village Pay for Phone (VPP) programme to facilitate access to finance through easy access. Through the VPP programme, the people at the bottom of the pyramid get access to alternate channel for banking through community banking. Grameen Bank provides a network structure of structural finance, which provide the benefit of community lending and access to finance for the people at the bottom of the pyramid. Comilla type of Grameen Bank institutional design helps to promote ensure competitive advantage in the form of stability and dynamic capabilities for the people at the bottom of the pyramid.