Muhammad Yunus Receives Nobel Peace Prize in Oslo

- "Use Microcredit to Help put Poverty in the Museums"

On Sunday, December 10, 2006, Muhammad Yunus and the microcredit institution Grameen Bank he founded 30 years ago will receive the Nobel Peace Prize in Oslo, Norway. The Bangladeshi economist, known to many as the "banker to the poor," started his journey toward creating the Grameen Bank in 1976 with a loan from his pocket to 42 desperately poor people in Bangladesh.

The total loan amounted to US$27 - less than US$1 per person. One of the 42 borrowers was a woman who made bamboo stools and a profit of just two pennies a day. With a loan from Prof. Yunus, the woman could now sell her product to the highest bidder and her profit skyrocketed from two pennies a day to US$1.25 a day.

Muhammad Yunus was trained as an economist, not a banker. Over the last 30 years he has broken countless rules of banking and other disciplines. He provided loans to the poor, not the rich; to women, not men; in small amounts, not large; and without collateral or excessive paperwork. The Nobel Peace Prize Committee is celebrating the work and breakthroughs of Muhammad Yunus, Grameen Bank, and all the other revolutionaries who have pioneered this remarkable intervention.

Oikocredit is one of these other pioneers. Just like Muhammad Yunus' Grameen, when Oikocredit started in 1975 its lending operations, it faced many drawbacks due to the lack of confidence in credit for development. Today lending to marginalised cooperatives or income-generating initiatives of poor people is no longer looked upon as non viable. With some 300 Microfinance Institutions (MFIs) in its portfolio, Oikocredit is the largest private financier of the sector. All together these institutions count some 7 million clients out of which Oikocredit's financing reaches 400,000(x) people. Gabay in the Philippines, Confianza in Peru, OMRO in Romania, Mec Delta in Senegal are just a few examples illustrating the geographically diversified portfolio and the wide range of institutions Oikocredit finances. "Our work is to fill as much as possible the gaps markets create between well established MFIs and the ones in deep need of support", says Managing Director Tor G. Gull, who will be attending the Nobel Peace Prize ceremony in Oslo.

Last month, Tor G. Gull, joined more than 2,000 delegates from 112 countries at the Global Microcredit Summit 2006 in Halifax, Canada. At that Summit, delegates launched Phase II of the Campaign with two new goals for 2015: 1) reaching 175 million of the world's poorest families with microcredit, affecting 875 million family members and 2) ensuring 100 million families rise above the US$1 a day threshold, lifting half a billion people out of extreme poverty.

As Muhammad Yunus says, "Poverty does not belong in civilized human society. Its proper place is in a museum." Let us work to use the awarding of the Nobel Peace Prize today as an impetus to put poverty in the museums, where it belongs.

The international development cooperative Oikocredit has over 30 years of experience in making credit accessible to the economically poor through investments of individuals, churches, and other institutions. Loans have proven to be a powerful instrument to not only bring about economic self-reliance and thus structural improvements to the livelihood of poor people, but also lead to enhanced self-esteem of the borrower. By the end of November 2006, Oikocredit had a total amount of 200 million euros outstanding with Microfinance Institutions and cooperatives as well as small and medium business enterprises in Asia, Africa, Latin America and Eastern Europe. Furthermore, Oikocredit finances Fair Trade initiatives that create a decent market for Third World products all across the globe. Oikocredit has local representation in around 30 countries worldwide.

www.oikocredit.org