Vinatha M Reddy
We can talk about making change. But affecting real change in the world comes from impacting the lives of individuals. It comes from empowering people to be independent and able to make a living on their own while at the same time being fully integrated in our interdependent global community. Sometimes it takes something that seems to be radical to make this change, but these shifts can be deceptively small. They can be even as small (or as large) as the cost of a Los Angeles Yoga class.
How could this be? In the practice of microcredit, lending seemingly small amounts of money to small-scale entrepreneurs allows them to succeed and change their circumstances. This is the fundamental basis of microcredit’s transformative power; it’s a revolutionary concept in finance. This practice shifts the emphasis from financial transactions being focused only about large loans and large scale businesses, which are out of reach of many one-person operations, institutions and organizations – to lending practices that actually make a positive difference in a person’s life. Microcredit practices based on social justice and empowerment operate through a combination of small-scale loans based on trust and community support, with structured repayment plans and programs that encourage savings. In these situations, people actually have the opportunity to solidify long-term change in their lives.
In 2006, economist Dr. Muhammad Yunus and the institution he founded, the Grameen Bank, were awarded the Nobel Peace Prize. This award was in recognition of their revolutionary efforts to create this micro-credit model, support sustainable economic practices, and provide an alternative to what were exploitive norms. When a person is caught in a cycle of poverty, they may become trapped in the system, particularly since large banking institutions have historically ignored people without assets or credit histories, who are just starting out and who may not have already proven themselves. Most banks prefer to lend large sums of money that represent a greater profit margin and are set up only for large loans in order to make a profit themselves. And even making it more challenging, people at the bottom of the economic scale worldwide have had to rely on moneylenders charging usurious terms and interest rates to obtain funds to plant the next crop, buy inventory of new equipment, or upgrade a business in any way. Institutions such as the Grameen Bank and their affiliates are offering another approach. It’s one that has significantly impacted millions of people.
As Dr. Yunus described in an exclusive interview with Yoga Gives Back in May, 2009, “We started in 1976, and today within Grameen Bank in Bangladesh, eight million people borrow micro loans, ninety-seven percent of them women.” This represents an enormous potential for change and empowerment that just did not exist on a large scale in this form prior to 1976.
There is a social cycle in economics, and Dr. Yunus explained this: “Poverty is not inside the person. Poverty is forced from outside. Poor people are as capable [a] human being as anybody else. They have the same power and energy, same potential. But they are denied such facilities. They cannot express themselves. Money is one of the most important items missing in their lives. You need a dollar to catch a dollar. You cannot catch a dollar with an empty hand. So, that first dollar, nobody has given to her. So she remains dependent on someone else. She has to be hired, to slave; she has to work to make food available on the table. What we have done, we have put that first dollar into her hands as a banking proposition. Conventional banks never come to the poor people. They go to rich people to make more money. The person who does not have a dollar – she cannot get it. So we did it. We did it in a way that is affordable to her. Because we do not insist on collateral. There is no collateral.”
While that may seem like a radical concept, the Grameen Bank has proven that their success is much more than ideological. Dr Yunus cited statistics for us, “The repayment rate is almost 100%, without collateral or anything. This is the strength of microcredit which is now spread all over the world. There are by now at least 150 million borrowers in the world today. But it is still very small comparing to the need. We need more microcredit organizations in the world so that more people can be reached.”
Yoga Gives Back is a 501(c)(3) nonprofit organization begun in LA, with the goal to provide a way for Western Yoga practitioners to give back to India, the birthplace of Yoga, which has given us so much. We’re heeding Dr. Yunus’ call to reach more people through expanded opportunities for and awareness of microcredit and have targeted India and Indian families, women, and would-be entrepreneurs, who would be otherwise stuck in the cycle of poverty that Dr. Yunus described. Yoga Gives Back supports microfinancing operations in India, through the Grameen Foundation, headquartered in Washington, DC. Donations go directly to Grameen Koota, Bangalore, South India and our YGB awareness campaign focuses on the real stories of how poor women are changing their lives with small loans from Grameen Koota.
Ms. Vinatha M Reddy
Grameen Koota was started by visionary teacher and philanthropist, Ms. Vinatha M Reddy (pictured, above) in 1999, who learned about Nobel Peace Recipient Dr Muhammad Yunus’ microfinancing and immediately began exploring ways of replicating his work in her hometown. In 2000, she started providing small microcredit loans, averaging $25.00 a month, to fifty local women. Today, Grameen Koota’s work is reaching out to over 280,000 women in Bangalore, Mysore and many areas of Karnataka state, in South India, making real impact on these women’s lives as well as on the local economy.
Mark your calendar: September 17th 2011 as a “Thank You Mother India” day. If you are a yoga teacher or studio owner you can host a special donation class. Others can donate directly or participate in a special donation class. Find out more here.
This article has been extracted from the one originally published in LA Yoga here and has been reposted with permission. To see how microfinance changes lives please watch this short video. The story of one of the co-founders is here. A quick microfinance FAQ is found here.
We shall be regularly publishing stories of lives that have been changed due to the funds donated by Yoga Give Back for microlending.