Microcredit

Grameen Bank and group-based microcredit

Grameen Bank replaced conventional collateral with small loans, recurring village meetings, peer groups, savings, and progressive access to credit, bringing millions of poor Bangladeshi women into a formal financial relationship. The system made dispersed lending operational, but also placed repayment discipline inside borrowers' social relationships; evidence about Grameen's institution is stronger than any claim that microcredit alone reliably ends poverty.

Can a lender replace collateral with relationships without converting a community's trust and pressure into an invisible collection technology?