JULY 3, 2000

Muhammad Yunus
Founder, Grameen Bank, Bangladesh

Muhammad Yunus, 60, first achieved acclaim with microcredit lending in Bangladesh back in the 1970s. His Grameen Bank lent money to poor villagers, and the paltry amounts were enough to let them create small businesses and generate their own income. Yunus' model has become Bangladesh's most successful export: 35 countries employ more than 100 similar programs.

Now, Yunus is enlisting technology in his war on poverty--with potentially even more successful results. Two years ago, he started lending cellular phones to rural women so they could earn income from placing calls: 1,500 villages now have them, with 100 more added every month. Yunus is upgrading the phones to give them Internet access--and installing Internet kiosks in rural areas. Soon, villagers will be running their own microcredit enterprises based on charging for Internet access. ''Microcredit is an empowering tool. Information technology is an empowering tool. I'm putting these together,'' says Yunus, a former economics professor. His first Internet kiosk, 80 miles from Dhaka, is having an impact. Students use it for research and finding information on applying to universities in the U.S. and Europe; doctors look up new studies that might not otherwise reach them. ''By adopting IT, Bangladesh can overcome poverty.'' With more people like Yunus, perhaps the whole world can, too.

A Chat with Muhammad Yunus

Muhammad Yunus, founder of Bangladesh's Grameen Bank, pioneered "microloan" seed money for grass-roots businesses. Now he is lending cellular phones to rural women and building Internet "kiosks" he believes can remedy poverty, illness, and isolation. He spoke with Asia Editor Sheri Prasso while in New York recently to address the Asia Society. Here are edited excerpts of their conversation:

Q: What's the reason you're moving to incorporate technology in developing countries, lending cellphones to villagers, etc.?
I got very involved in information technology issues because of its influence in large advanced economies like the U.S. and Europe. The old relationships are changing in business -- like in the value chain, middlemen are eliminated. This is changing the cost structure, changing the direct link between the consumer and producer.... It's becoming a new society, not only a new economy.

In my work in Bangladesh I'm trying to use information technology to address the issue of poverty. So we created Grameen Phone. The conventional mobile-phone company will be selling mobile phones to the rich people, the well-off people. But we decided to take to the villages and to the extreme poor people.

It was convenient because we have Grameen Bank, so the financing part was easy. So we are financing the phone, and the woman sells the service of the telephone in the village and makes money. It's a win-win situation all around. She never saw a telephone in her life. She never used one. In many cases she never saw electricity. So we are bringing the brand new cellular telephone -- state-of-the-art technology with a solar panel on top to charge the battery -- to villages that don't even have electricity.

She quickly masters this technology. If you see her after three months of her work, she talks about the phone and her plans as if she has been in this business for a long time. She knows the country codes, area codes, when is a good time to call, who calls what time, time differences. She knows this very quickly. Basically she's an intelligent person. She's illiterate, but she's an intelligent person. Information technology helps her, it helps farmers check out the market prices in the cities, rather than relying on a middleman to tell them a story. They can contact the doctors, police.

Q: How quickly will you be shifting standard cellular lines to Internet-connection phones?
We'll be doing that as soon as those telephones are in the market. In the meantime we set up an Internet service provider company, the largest in the country, and we are bringing Internet services in the villages of Bangladesh through an Internet kiosk, so that people can use Internet facilities.

They're coming for e-mails, for browsing, Web sites. There's an easy connect between the city and the villages. We have one we set up six months ago in Madhupur, about 80 miles from Dhaka. The next will open in about two months in Jamalpur, about 100 miles from Dhaka. Grameen Communications set it up. People can come just like you come to the telegraph office, except now you send an e-mail. You go and send a message and immediately get a reply.... People are using it for e-mail accounts, students looking for information browsing the Internet, looking for admissions opportunities for colleges.... doctors looking for information about medicine, health articles and whatever.

Q: Grameen Communications runs the kiosks now. But will they be turned over to villagers, like the cellular phones?
Yes, that is our plan. There are 22 independent companies around Grameen Bank. They have to find and make their own financing. Grameen Cybernet is the Internet service provider. Then we have a Grameen Software involved in software development.

If we can bring Internet properly, we can address the health-care system, for doctors who can provide the services from the city via video conferencing. We have Hewlett-Packard as a business partner on this project. If it works, it opens up a new business opportunity for them. It's also a social service. Because I challenged them, I said, "You make a lot of money but you don't do anything for poor people?" And they said, "What can we do?" I said try out something like this....

Soon it will be active. It's not a clinic, it's more like a cyberclinic. The doctor can be in Dhaka and talk to the patients as if they are in his clinic, and see how they benefit from long-distance treatment. We'll start with two or three specific diseases so that we have specialized doctors and then expand the range of complaints.

Education could become another interesting area, where illiterate people can become literate. We have an agreement with Medialab of MIT, where we are trying to develop speech technology for our language, Bangla. The idea is that people can speak in Bangla, so even if you are illiterate you can speak in Bangla and can get the text. So we hope to address the illiteracy issue in a much more entertaining way. You don't need a teacher. The computer becomes your teacher and friend.

For a woman in Bangladesh, she often doesn't have a companion. Man-woman relationships are very distant in Bangladesh. It's not an easy, friendly relaitonship. So this way she can explore the world and be informed. She doesn't need the middleman of her husband, because he's the one who goes outside to the world.

Q: So you're saying that technology has so many more applications to help the poor than to help the well-off?
Fantastic opportunity, but nobody's noticing that. The reason people are not noticing that is because information technology is in the hands of businesses, pushing in that direction, for business-to-business portals. So there are all kinds of possibilities when you can access the outside world. She can learn, she can find a job, all kinds of possibilities. It doesn't matter if you are the richest person in the world or the poorest person in the world, you have the same potential.... We can create truly a world without poverty in this way. Information technology gives us tremendous possibility for doing that.

Q: You're working to establish a Center for Information Technology to Eliminate Global Poverty?
Yes, I've proposed setting up this center. I've talked with technology people, interested people. I've met Jim Wolfensohn at the World Bank. I've talked to President Clinton about this when he was in Bangladesh [in March]. He took tremendous interest in it. He said this is an idea whose time has come. He had a meeting in the White House right after he came back from Bangladesh. He invited Bill Gates, Alan Greenspan, Amartya Sen, Jim Wolfensohn. Everybody was there to talk about how to overcome this digital divide, so that we are not creating two kinds of people -- one equipped with this powerful technology, one that's deprived of this technology.