Muhammad Yunus and Chelsea Clinton on the Power of Social Businesses

that access to capital is a fundamental human right. The bank gives small loans to impoverished women to help them start and grow their businesses. Turns out these women are a great credit risk. Not only do they pay back their loans, but they also reinvest their earnings in our communities, improving everything from education to health care. Units joined us at the Seneca Women form at the Metropolitan Museum of

Art where he sat down with Chelsea Clinton. Listen to their conversation and learn about the incredible work that earned Units a Nobel Peace Prize, and here about the advice he has for each of us on how we can make a difference and stick around after the conversation. For my top takeaways. We'll be back after this break. It's like, well, it is such a privilege for me to be here UM with someone I have long admired. UM. I actually was honored to visit a Gramen village UM more than

twenty years ago. Goodness, UM, and you know saw than the transformative kind of power and action UM of of micro credit and yet understood then and I think understand kind of more deeply now that kind of the loan is only the beginning of of the relationship between UM Gramin and it's now I think nine million borrowers. And so I think given the video highlighted kind of the credit dimension and that is where Gramin had its origins

more than forty years ago. You know, Professor Units, could you talk a little bit about um kind of what else goes along with the loan UM. So that kind of the money is maximally empowering and affecting for your borrowers, their families and their communities. Well, thank you. You remember the your visit plus years back. Uh, that was the middle of our journey. Now for years now it's all over Bangladesh. It's every single village is there. Uh Now

over nine million borrowers. As you mentioned, it's not only credit, because that word coined for the work that we do is micro credit. So everybody they lend money. But there are many other dimension to the our work. For example, every borrower has to have a savings account as soon as she starts the journey with us, so that even if you're very poor, even if it's a penny per week, you put the penny. Never missed that every every week

you have to put something in your account. So people were wondering why this little money and what's the use of this money, But the power of doing it regularly didn't realize at that time. We didn't realize at that time how big that will be. For example, today we lend out about two and a half billion dollars a year to these borrowers that we have in their savings account.

From two thou sixteen, middle of two thou sixteen, they exceeded the total amount that we lend to mean that they have more money in their savings account then we lend me. It is more than two and a half billion dollars in their savings account, so they are not only borrowers, their savers. And I tell the officials of the coming bank. I said, well, you don't refer to them as borrower anymore because they are actually lenders. You have the borrower because they give you more money than

you give them. So that's kind of turning on the whole thing. And when you have money in your bank account, you feel completely different. You're secure, you're not up in the air not knowing what the world is looking like. Will we like here? So that's one aspect of it. Then we tried to make the second generation of the borrowers make sure that they don't repeat the same thing

as their parents who are illiterate. So you want to make sure the second generation will go to school and go as far as they can go, and they continue to go to school, continue to go to higher education and come in banking scholarships, come in bank of education loan, so that nobody stops education just because there's not money for them. So they will say, your mother's bank has all the money that you need, you just go ahead and continue. So you have a whole new generation, second

generation coming up literacy education in that system. So that's another part of it. Sanitation one thing which just was missing completely for years back in Bangladeshi villages and so on. We made a rule in come in bank. If you want to join them in bank, first thing you have to do is to dig a hole and use it as a pittal train. In the beginning they were puzzled, white we have to do that, But soon they realize

how important that is. And then you started giving loans for sanitary toilet that are very special type which is designed by W. H O and very effectively. Uh simple. So we build this in the village and give them the loan and they go to the company that we created which is producing it. They come in and install it for you. And women loved this idea because for them is such a deep hassle to wait for the sun to go down so that they can go out. Men can go any time they want, but not the

women because they have to wait. And so Twoman of Spain for them. So when they see that this one is releasing their all these patients pent up problems. They were so happy. It brought pressure on the families, even well of families, rich families. We still don't have toilets h. Then they are women and their families started complaining, how can even the begger women have their toilets, we don't

have them. So that pressure now brought to Bangladesh. Almost every single village now have toilets because everywhere so so it's not only limited to the gramin bank families. It is spilt over to it. And healthcare as another issue that we realized that this is this is almost synonymous. If you are poor, you are poor in health. So it goes together and it shows up in many different ways.

How those children become sick and thin and manly ashed and mothers particularly extremely man that wished and have so many problems. So we went into a healthcare program. So a series of things developed along the way. Some of them became a series of businesses that we created a special type of business, meaning that he has to be self sustaining, like sanitation is a self slufstaining. It's not

a charity. We give them the loan, they pay over a long period, but they pay back, so that there is no obligation for somebody that I'm obliged to give me a free toilet. There's no free toilet, so you pay for it and it's your toilet. And for healthcare, we made it very simple, very effective, so that they can buy it and make it happen, So that let it us into a different dimension and completely called social

business business to solve problems rather than make money. But I think you were already engaged in the work before you realize that you were doing exactly have any ideas, but no idea what you were doing until you realized you had done it and then had to name it. So maybe you could talk a little bit about this kind of social business and kind of what that, what that means, um and and the different manifestations, because I know they're also different types of social business as well

as clearly different industries that you're engaged in. Seeing this repeatedly that people kept saying, what is that that you're doing that? Does it make sense to you? I said, it makes on the sense to me. But you're not making any money. I said, I don't want to make money. I want to solve the problem. I don't want to lose money either. That's the company makes money, but the company keeps the money. Uh, And I'm not I'm doing

it to solve the problem. So gradually I gave it the name is a problem solving company to distinguish it from the money making company. There's a problem solving company. People love to day and say, well, what is a problem solving company? And then I have to give a little respectable name called it social business. Now it's became known as a social business globally and people love it. And we do that and we create created hospital created like Ika hospital. There's a uh. Cataract is a big

issue in Bangladays. I'm sure it's many other countries. People don't know that they can fix their eyes. They think if you grow old, you see less. It is part of the growing up process or getting old proceedging process. Then we said no, this you can be fixed. But it for them. It's very difficult to come to the city, to pay a lot of money to come to the city. And usually when a Bangladeshi person goes to a hospital, the whole family goes back, so they will not let

him go alone or let her go along. So it becomes extremely expensive for people to bring the whole family to the city and do that. So what we did we've built a beautiful i caa hospital in the village and then started providing the service, very good quality service. People loved it. But we made a payment system if you can afford to pay the full price, you pay that it's about thirty dollars to have one. I've cataract operation.

Very good surgeon. Uh. And if you cannot afford the full price, you pay for the consumables like the lens you got, the medicines that we gave and so on. So whatever you're using, you don't have to pay for the establishments and so and if you cannot afford that, you just pay token one dollar and everything will be done. So we make money at thirty dollars when we do that, and we cross subsidize at people who cannot pay the full price. So the whole hospital is run with the

covering the entire funds entire money. The first hospital came to the break even point in four years. We're very happy that we came to the break even point. Now it's self sustaining. Then you started the second hospital in another part of the country. That hospital came to break even point in three years, so we got more excited. Now we have four hospitals running and they are paying back the money that we invested. And as we get

better money, we invest in another hospital. So the same money now going around building one hospital after another hospital as a social business, because in social business you return the money that is invested and you don't take any profit after that profit is blocked back into the system. So this is what just happening. And also we had the problem of electricity Bangladesh. That's and happy electricity, particularly individual villigious. You go to the villages, you see kerosene lamb.

That's about what you can say anywhere you go. Everybody sad thing to see when the sun goes down, the whole country becomes dark. They all see little feeble them and feel said that in this day and age people have to live like that. It reminds you of the cave days, not to civilized days. So one idea that we came out, why don't you bring the solar energy that doesn't need huge investment build all those thingsfrastructure of

which government has to do. This can be done by individuals and we can convince the expert that said always two difficulties to experience. It's good for Europe, good for North America, but it's not good for banglareshious and roses. So let's try that. So we created a company called Grammin Energy or Grammy shock Ting and it started selling solar home system and they were in the beginning everybody, this is too expensive. We cannot afford it. Selling five

or six solar home system per month. It was such a challenge, but we didn't give up that this could finally people who realize the benefit of it. Then we came up to the very simple idea. We tell them, okay, it's expensive. You tell us it's expensive. How much you spend in your carosine every month. They didn't calculate, Oh, I spent so much for our carosine at home. Why didn't you give to every month the same amount to us, and we give you the solar home system. So you

know this is not something additional. You just get everything. You get your solar home system and you do it for three years. Once you have done this for three years, every month save money that you spent for kerosine. This is all yours. You don't have to pay a penny to anybody because in the meantime we've got our money back, the spent that we've money spent for the solar system.

Then this is started rising. We came in our in the fifteenth year of our operation this company, we came to a level who were selling a thousand solar home system per day. Today we have nearly two million homes with solar home system all self that everything, it don't it's not a charity system. You're paying back just like your electricity bill every month. You're paying the caro bill,

that's all. And you've got your solar system. And we became the largest of great solar system in the whole world. Nobody was well. While social business may have kind of

more pizzas to it, I think problem solving maybe more accurate. Yes, um, you know, Professor Units, I think it would be particularly interesting to the people here this evening if you could talk about your experience over last ten years with with Gramine in America, because it's been a decade since since you've been here formally, Although maybe you could talk about one of your first trips to America, which was at the invitation of my parents more than thirty years ago

exactly so, Professor Units came to Arkansas I think in nine three, way back way back. But we are continuing to date ourselves here on the stage this evening, but maybe just talk a little bit about that experience. But really, um, I think the audience and I certainly would love to hear about kind of now your your decades perspective of working with with Gramine here in America and um and where you think you're going next. You sent me to

the memory lane. Now, somebody told me that there's governor in a US state who is interested in what we're doing in Bangladesh. I didn't know who this guy is. Then one thing is extually to see the letter from him. He said, would be very happy when you come to the United States. You'd like to talk to you and uh like to understand what you're doing. So I said, okay, when I come next tent if I'll do that. So

I did that. At that time. Governor was attending Governor's conference in Washington the day I Kim, so he said, when you're coming, if you come to Washington, you don't have to go to ARKANSO we meet there. So I met him that the governor of Arkansas, Bill Clinton, and his wife Hillary Clinton in a hotel room four seasons Hotel,

I remember. So he questioned and question and question. He's two banker friends, American banker friends also present, because he wants to understand how much it sounds like a banking um At the end, he said, oh, this is fantastic. Can you can we do it in Arkansas? We need it because exactly what you have the same problem. We have lots of poverty and so on. This is the exactly right thing for us. Then he asked the banker friends, how long will it take to do that? To process

this whole thing? She started, The banker friend said, you need this clearance, you need this permission. It will be between six months a year before you can really set it up. So Bill Clinton was very upset that they take so much time. You want to get it done right away. He looks at me, he said, do we have to wait that long? I said, not with me? I said, how long will you take? I said, I can start tomorrow. I'm plending money. I don't have to go to anybody. I mean, you don't call it a bank.

The moment you call it a bank, you get trapped in all the rules and procedures. I'm just giving the money, that's all SPI He said. I like that. Why didn't you come to Arkansas? I said, and that that's a very elaborate visit to arkansole meeting, I said. The amazing resultside people sitting there. There's no work. There used to be a government tractory closed down, no jobs. And I started talking to them. They couldn't believe a bank will lend them the money. Said, no, bank don't have the money.

Why should they talk to you. I said, no, I'm not a bank. I just came to you. If you think you can use some money, I'll give you the money. Then they started talking, and you started this program called Coming Fund in Arkansas and became a very formal structure, and so started doing that. It continued, We get very encouraged, but after governor got elected as a president, they gradually the program get died down. It's nobody paid any attention to it. And then every time I come to United States,

people say, well, coming doesn't work in Bangladesh. In the United States, it's my work in Bangladesh, but Americas a different content will never work. And later on people saying, we tried it five hundred times in five different institutions, don't it doesn't work. Then I started saying, you can do with five thousand times and every time you will fail. But I will keep saying it can be done. How come it's fails? And you said it can be done,

I said, fails. It doesn't mean it cannot be done. Fails. It only means you didn't know how to do it. Very a little thing. And somebody in the audience stood up that if you're so sure, why didn't you do it here? I said, I'll do that. Give me the money, I'll do it. And that was the beginning of GRAMM in America. And the guy after the conference, he just stood by. He said, how much money would you need? I just quickly calculated, and how many borrowers? What on

the difficult size of loan. I said, for each branch, you have to find me at least six million dollars, assuming that there'll be four thousand borrowers. He said, I'll find it for you. I said, then I'll do it for you. So we started this discussion went on in two thousand and seven. In two we runched it in January in Jackson Height and became a beautiful branch. Every single thing. It's a hard work because people didn't understand what it is. We have to explain everything that we did.

We send someone from Bangladesh branch manager in Bangladesh. I told him why you do it in Zexon height. He said, but I've never been to the United States. I don't know. I don't know anything about United States. I said, who told you to do anything about the United States? You know everything about grammin in Bank. That's why we're selling you there. You just do whatever coming in bank does.

They don't listen to anybody. He did precisely that he could careless what people say, Oh, you have to do this, I said. He said, I don't do anything. I do district. It worked, and today there are twenty branches all over the United States. There are seven branches right here in New York. Andrea was here. He was He was explaining hundred thou borrowers already all over the United Women. They lent a billion dollar already, and they're planning for the

next ten years. They're celebrating tonight that their first decade, and they're calculating how much money they will be needing. So I was asking them last night. I was saying, how much money you needed to get to the billion dollars? They calculated less than a hundred million dollars. With hundred million dollars, we gave one billion dollar. Long that's the kind of capacity that you want when you recycle money, I said, from one hundred thousand borrowers. How far do

you want to go safely? She said, we have twenty branches now we can do easily forty branches very quietly, no problem. And how much money can you give up? Said ten billion dollars? And how much money will be needing for ten billion dollars? Calculates are two fifty million dollars and retainment record, no legal papers, no lawyers involved. Everything is perfect. I hope it is evident now why Mohammed Units is a hero to me into so many

um and I'm thrilled. I think if I heard correctly that he's only just getting started in his work here in the United States. Yes, good, you heard it here on stage. And two d fifty million dollars not a lot of money. Anybody can do that. Just provide the money. It will be ten billion dollars in ten years. Be your friends are listening here, same thing as well as it does all my problem solvers. It just doesn't make

sense to me. For two hundred fifty million dollars a million half a million women could change their life, and you give ten billion dollars as a loan to them. And you get it back. Never happened in history, but they're doing making that history. It's all questions, just putting. And you're not giving away the two hundred fifty million dollars. Those two hundred fifty million dollars will return to you.

That is still these people will be I'm converted, alrighty, But I certainly hope that if you weren't at the beginning of the session this evening, you are now, and I want if we don't get at least keep going, I'm with you if you if you don't get that two additivety billion dollars to put it to the second decade, I'll say something wrong in the American mind. I cannot

understand this, terribly wrong. Well, hopefully the collective we and more broadly will will prove that there is still quite a lot right in America and that we do have to continue to fight for a shared future. So I just am incredibly grateful. Please don't give Professor Units a tremendous robber pause. Thank you very much. Stay tuned for our takeaways after this break. I hope you enjoyed that fantastic conversation between Chelsea Clinton and per Fessor Mohammed Unis.

Visit Grimin Foundation dot org to learn more about the Grameen Bank and the amazing work they're doing around the world. Our top takeaways. First, Unie shows us that models that recognize the fundamental dignity and potential of every human being will succeed. He challenged the notion that impoverished women are

bad credit risk and the results are phenomenal. Second, social businesses may provide us with the opportunity to solve some of the world's toughest challenges, and inspired by Unice, more and more entrepreneurs are starting their businesses with exactly that in mind. Finally, when we change the way we look

at the world, anything is possible. Unit saw potential where others saw poverty, and when the critics said his plan was unworkable, he stuck to his vision, reminding us that failure doesn't mean it can't be done, only that it hasn't worked yet. You're listening to Seneca Women Conversations on Power and Purpose, brought to you by the Seneca Women Podcast Network and I Heart Radio with support from founding

partner p ANDNG. Listen to Seneca Women Conversations on Power and Purpose on the I Heart Radio, App, Apple Podcasts, or wherever you get your podcasts, and please support this podcast by telling your friends, subscribing, and rating us. For more information on Seneca Women, follow us on social media, visit our website Seneca Women dot com, and check out the Seneca Women app free in the App Store. Have a great day.