On August 2, the Cabinet approved a proposal that amends the Grameen Bank Ordinance 1983, which reduces the power of the bank’s board and instead gives more authority to the chairman for picking the managing director of the microfinance institution. In the amendment, the government-appointed chairman of the bank, in consultation with the board, will prepare a three-member panel for the Bangladesh Bank’s consideration in appointing the managing director.
Of Grameen Bank’s 8.3 million borrowers, 97% are women. These women currently own 96% of the shares of Grameen Bank and control 9 of the 13 board seats. If the government of Bangladesh were to grab control of the Bank away from the women people fear that this could lead to a tragic setback for women’s empowerment.
Reactions to the amendment
58 women leaders and professionals in the country condemned the government move to amend the Grameen Bank Ordinance, saying it would deprive its real owners of their role in managing their bank. They claim the government’s proposed amendment has the effect of allowing the chairman to take undemocratic decisions, overriding the views of the majority of the board who are the women representing its borrowers.
Muhammad Yunus, founder and ex-managing director of the bank has always feared the possibility of the government taking over the bank. His comment on the latest developments is “Now my apprehension has started to become a reality. I am so disheartened that I am unable to express my feeling”.
The Daily Star supports Yunus’ fears. They write “It does become clear as daylight that the singular purpose of the amendment is to transform the character of the bank’s uniqueness and originality. We believe this move is to empower the Chairman over the Board with regard to appointment of the MD.” The fear of a takeover is also shared by other supporters. More than 1,000 people from 70 countries have already signed a petition to help protect the independence of Grameen Bank and its women borrowers. In addition, 21 microfinance institutions (MFIs) and international organizations have officially endorsed this petition to defend the rights of the women borrowers of Grameen Bank. Among them are Cashpor Micro Credit (India), Entrepreneurs Savings & Credit Cooperative Society Ltd. (Bangladesh), Kashf Foundation (Pakistan), FONDEP MC (Morocco), Cooperativa de Ahorro y Crédito “Padre Vicente Ponce Rubio” Ltda. (Ecuador), FINCA International (USA), and Freedom from Hunger (USA).
More information on the petition and quotes of people that have signed it can be found here >>