Breaking the Bank
Making his way from Chittagong to Dhaka, Graham Brewster knew the overnight bus ride would be long and uncomfortable. He had made a number of bus journeys around Bangladesh during his six-week internship with the Grameen Bank and knew what to expect. Still, nothing could have prepared him for what was about to unfold.
The bus driver had been carefully navigating the chaotic roadway for hours when suddenly he had to brake. “There was a big commotion on the road ahead,” says Brewster. “I hopped off the bus to see what was going on.” An accident between a truck and an auto rickshaw had left the rickshaw‘s two passengers dead. In response, the local villagers pulled the truck driver out of his vehicle, demanding justice.
"They lit his truck on fire and took him away."
When the police arrived on the scene a short time later, they met with members of the 150-person mob and left, unwilling to stand up to them. The brief police visit didn’t resolve anything and the mob wouldn’t allow the road to reopen until the driver was punished. “So they lit his truck on fire and took him away,” says Brewster. “I never saw what happened to him but soon after I heard cheering. The road cleared and we drove around the burning truck." Brewster never learned the fate of the driver.
As distressing as it was to witness this scene, by this point in his internship Brewster felt he understood the national context behind such incidents. “Bangladesh has one of the most corrupt governments in the world and their law and order system isn’t exactly up to snuff,” he says. This is in a country with a dozen reported road deaths every day (and many more may go unreported). A long history of corruption and inaction on the part of governments has made many Bangladeshi people distrustful of the authorities, leading them to take most matters, from meting out justice to creating livelihoods for themselves, into their own hands.
While this do-it-yourself national attitude sometimes manifests as vigilantism, as Brewster witnessed, this self-reliant spirit is more evident in the Bangladeshi people’s incredible capacity for entrepreneurship. In fact, it was an expression of this very spirit that brought Brewster to Bangladesh in the first place. He was there to learn how the Grameen Bank, an organization that has a high degree of independence from the government, works to alleviate poverty by financing and facilitating small-scale social enterprises at the community level. “I was an altruistic business student at UBC,” he says. “Not that finance, accounting and marketing seemed bland, but I liked the more social aspect of things.”
Brewster first became interested in the idea of social business when he was living in South Africa while on a UBC exchange to the University of Cape Town. “It really opened my eyes to the developing world and the important role that business can play in sparking things from the ground-level up,” he says. After graduating, he applied for some microfinance internships with the intention of returning to Africa.
With this goal in mind, Brewster left Vancouver to travel through the Middle East. Along the way, he read up on Nobel Peace Prize recipient (and UBC honorary alumnus) Muhammad Yunus, founder of the microfinance model, and the Grameen Bank he established in Bangladesh in the late 1970s. As he read, he became even more excited by the possibilities he saw. “Microfinance immediately jumped out at me as something to which I could apply my business sense and my natural entrepreneurship traits, while contributing to a social goal,” says Brewster.
During his travels, Brewster had a chance meeting with someone who had worked for Grameen. He was put in touch with the bank and applied for one of its internships directly. Soon after, while in the Jordanian desert, he learned he had been accepted on the condition he could arrive in Bangladesh within 13 days. Despite his shoestring budget, Brewster arrived in Dhaka two days later via Alexandria in Egypt and Dubai. “It was like stepping into a completely different world,” he says. “Dhaka is like an urban jungle. It’s one of the most densely populated cities in the entire world. There are people everywhere. It’s frantic, extremely loud and a total eye-opener.”
"Leaving Dhaka, it never felt like we left the city. Everywhere we’d go, we’d feel like we were still on Dhaka’s outskirts.”
For accommodation, Grameen provided a dorm-like hotel a short walk away from the bank’s headquarters. On his first day of work Brewster learned that every night more than 200 kids slept on the traffic circle between his hotel and the office. This dense urban poverty shocked him, but he soon realized it was endemic throughout Bangladesh.
Grameen’s banking activity is very much a rural endeavour – Grameen means village in Bengali – with the central bank headquarters its only presence in Dhaka. As a result, Brewster spent much of his time travelling around the countryside. He points out that “countryside” doesn’t mean what it does in Canada. “Leaving Dhaka, it never felt like we left the city,” he says. “Everywhere we’d go, we’d feel like we were still on Dhaka’s outskirts.”
Brewster felt privileged to see this side of Bangladesh. “It was great to see the day-to-day workings of a typical village. It’s pretty tough for a lot of people but I got to appreciate how people’s work ethic and abilities could make their lives better.” He recalls one borrower who had been with Grameen since 1991. In that time, she had been able to grow her business into a family affair. Her daughters were among the first to receive bank scholarships and became fluent in English. “I could really see how their lives had improved and evolved thanks to Grameen,” he says.
Brewster feels that the strength of Grameen’s model lies in its transparency and social orientation. Yunus set it up so that it would be clear to all stakeholders that no individual would personally profit from its borrowers. While the microfinance model has been corrupted by moneylenders in other places around the world, Brewster feels any judgement of Grameen on this basis is unfair. “It’s such a smart financial system. They’ve essentially built a banking system and allowed all these people access to credit, which has given them amazing opportunities,” he says. That a system with Grameen’s level of transparency can exist at all within Bangladesh’s corrupt national structure seems remarkable to him.
The model’s brilliance became clear to Brewster one night when he was sitting in a village with a branch manager. The power had failed, leaving them in candlelight. They had just finished a typical dinner of duck curry and rice when they started to talk about the core principles of the Grameen model. “That’s when I realized that it’s simply a banking system with a social goal,” says Brewster. “They do credit checks on their borrowers using unique facets of the culture. Villagers know each other and they’re able to verify the businesses just by going to visit them. Because the wages are so low, the bank is able to have more than 27,000 workers, meaning they have a lot of contact with the borrowers.” It was then that he realized that although the enormous size of the bank makes it seem complex, it’s really quite simple: the bank lends out money and then gets it back at a set interest rate by following up with its borrowers. It has proven to be a scalable model because it is so simple and benefits everyone.
The major challenge that Brewster sees with the microfinance model going forward is that it seems too good to be true and is often touted as something that will transform the world. “It’s only a tool, and when it’s put in good hands it can do some powerful things,” Brewster says. “However, I don’t think it’s the single answer to all the world’s problems by any means.”
In his time at the bank, Brewster was fortunate enough to meet Muhammad Yunus twice. Their initial conversation took place on the first day of his internship and it was then that Brewster first sensed Grameen’s family atmosphere. It made him feel that this was a place where social objectives really seemed to come ahead of personal gain.
"I could tell from the way he discussed microfinance that it was something that he cared deeply about. You realize that he’s just one person who has put his passion to good use.”
The second meeting came at a more difficult time for Yunus. In late 2010, a documentary originating in Norway made claims of corruption and tax evasion against Grameen. Soon after, another documentary made similar claims. The Bangladeshi media quickly started to attack Yunus in an attempt to shift public opinion against him. Many observers believed that this negative press was at least implicitly supported by the government. Despite the fact that everyone within the Grameen system continued to support Yunus, Brewster sensed that he seemed deeply shaken by the criticism. Despite the turmoil, Yunus still found time to sit down with Brewster and his fellow interns for a frank and in-depth conversation about their interests in microfinance. This conversation was of the highlights of Brewster’s Bangladesh experience.
“It didn’t feel like he was doing it as a formality,” Brewster says. “I think if I were to write to him now, he would remember who I was and would write back. I got a very genuine feeling from him. I could tell from the way he discussed microfinance that it was something that he cared deeply about. You realize that he’s just one person who has put his passion to good use.”
In the time since Brewster left Bangladesh, the government has removed Yunus from his position at Grameen. Although the allegations put forward by the documentaries were ultimately disproven, the government forced him out using a rarely-enforced mandatory retirement age rule. In March, 2011, Bangladesh’s 77-year-old finance minister, Abul Maal Abdul Muhith, formally removed the 70-year-old from his post as the head of the Grameen Bank. Despite the government’s claims that it was making the change to bring the bank under greater government regulation, Brewster, like many people in the country and around the world, feels that it was entirely motivated by politics, with Prime Minister Sheikh Hasina seeing Yunus’s incredible national and international popularity as a threat to her hold on power. Regardless of the reasons, the long-term impact of this move on the bank and the lives of its borrowers remains uncertain.
As for what’s next for Brewster: “I’ve definitely got more adventurous and altruistic ventures ahead of me,” he says. “Yunus, the Grameen Bank and the Bengali people have really inspired me to push forward with my own ideas for social businesses. I truly believe that this model can do a lot of good in the world.”