Muhammad Yunus

• 1. Introduction

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  Muhammad Yunus, a Bangladeshi economist, once handed US$27 of his own money to 42 village women. Each woman made a profit of just BDT 0.50 on her loan, roughly US$0.02. It sounds like nothing at all. Yet from that tiny result he drew a conclusion about poverty and credit that would travel far beyond his village. Why did so small a sum matter so much? What made a university professor believe that the poorest borrowers were a better risk than the banks assumed? And what happens to a man who builds something this admired when the politicians around him begin to resent it?

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• 2. Scholar Before Banker

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  On the 28th of June 1940, Muhammad Yunus was born in the village of Bathua, at Hathazari. The village lay beside the Kaptai road in the Chittagong District of Bengal Presidency, in what is now Bangladesh. He was the third of nine children in a Bengali Muslim family of Saudagars. His father, Haji Muhammad Dula Mia Saudagar, was a Sufi jeweller. His mother was Sufia Khatun.

  In 1944 the family moved to the city of Chittagong, and the boy traded his village school for Lamabazar Primary School. By 1949 his mother was suffering from psychological illness.

  In 1952 the young Boy Scout travelled to West Pakistan and India, and in 1955 he went to Canada, both times for Jamborees. At the matriculation examination, taken at Chittagong Collegiate School, he ranked 16th out of 39,000 students in East Pakistan. At Chittagong College he threw himself into cultural activities and won awards for drama. In 1957 he enrolled in the Department of Economics at Dhaka University. He finished his BA in 1960 and his MA in 1961.

  At the Bureau of Economics at Dhaka University, Yunus worked as a research assistant to the economists Nurul Islam and Rehman Sobhan. In 1961 he became a lecturer in economics at Chittagong College. On the side, he set up a packaging factory that turned a profit. A Fulbright scholarship took him to the United States in 1965. In 1969 he earned a PhD in economics from Vanderbilt University, through its Graduate Program in Economic Development. From 1969 to 1972 he was an assistant professor at Middle Tennessee State University in Murfreesboro.

  In 1967, while at Vanderbilt, Yunus met Vera Forostenko, a student of Russian literature whose parents were Russian immigrants to Trenton, New Jersey. They married in 1970. The Bangladesh Liberation War of 1971 then pulled him into activism. He founded a citizen's committee, and with other Bangladeshis in the United States he ran the Bangladesh Information Center to raise support for liberation. He also published the Bangladesh Newsletter from his home in Nashville.

  Returning to Bangladesh in 1972, Yunus joined the government's Planning Commission, headed by Nurul Islam. He found the job boring and resigned to lead the Economics department at Chittagong University. The famine of 1974 changed his direction. After watching it, he took up poverty reduction and set up a rural economic programme as a research project. In 1975 he developed a scheme called Nabajug Tebhaga Khamar, which the government adopted as the Packaged Input Programme.

  President Ziaur Rahman introduced the Gram Sarkar programme in the late 1970s, after Yunus and his associates proposed it to make the earlier project more effective. In 2003 the government formed 40,392 village governments as a fourth layer of government. On the 2nd of August 2005, the High Court declared them illegal and unconstitutional. It was responding to a petition from the Bangladesh Legal Aid and Services Trust, known as BLAST.

  In 1977, in Chittagong, Yunus and Vera had a daughter named Monica. Their marriage ended within months, because Vera returned to New Jersey, saying Bangladesh was no place to raise a baby. Monica grew up to be an operatic soprano based in New York City. In 1980 Yunus married Afrozi Yunus, then a physics researcher at Manchester University, who later became a professor of physics at Jahangirnagar University. Their daughter, Dina Afroz Yunus, was born in 1986. His brother Muhammad Jahangir, who died in 2019, was a television presenter and social activist. Another brother, Muhammad Ibrahim, a former physics professor at the University of Dhaka, founded the Center for Mass Education in Science, which brings science education to adolescent girls in villages.

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• 3. The Village Bank

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  In 1976 Yunus began visiting the poorest households in Jobra, a village near Chittagong University. There he learned that very small loans could change a poor person's life far out of proportion to their size.

  The bamboo furniture makers of Jobra had to take usurious loans to buy their bamboo, and the lenders took their profits. Traditional banks refused to make tiny loans at reasonable interest, fearing default. Yunus thought differently. He believed that, given the chance, the poor would not need to pay high interest and could keep what their own labour earned. On that reasoning, microcredit was a workable business model, and Yunus is credited with the idea.

  In December 1976 Yunus secured a loan from the government-owned Janata Bank so that he could lend to the poor in Jobra. The effort kept going by borrowing from other banks for its projects. By 1982 it counted 28,000 members. On the 1st of October 1983, the pilot project began operating as a full bank for poor Bangladeshis. It was renamed Grameen Bank, meaning Village Bank.

  At the centre of Grameen's repayment system sat the solidarity groups. Members of these small informal groups applied for loans together and acted as co-guarantors of one another's repayment. They also supported each other's efforts to get ahead. By July 2007 the bank had issued US$6.38 billion to 7.4 million borrowers. More than 94 percent of its loans have gone to women, who suffer disproportionately from poverty and are more likely than men to spend their earnings on their families.

  In the late 1980s Grameen began putting underused fishing ponds and irrigation pumps, such as deep tube wells, to work. By 1989 these interests had grown into separate organisations. The fisheries project became Grameen Motsho, the Grameen Fisheries Foundation. The irrigation project became Grameen Krishi, the Grameen Agriculture Foundation.

  In time the initiative grew into a group of profit-making and non-profit ventures. They included Grameen Trust and Grameen Fund, which runs equity projects such as Grameen Software Limited, Grameen CyberNet Limited and Grameen Knitwear Limited. Grameen Telecom holds a stake in Grameenphone, the biggest private phone company in Bangladesh. From its start in March 1997 to 2007, the Village Phone project, also called Polli Phone, brought cell-phone ownership to 260,000 rural poor in over 50,000 villages.

  About 100 developing countries saw similar efforts inspired by the Grameen model, and so did developed countries such as the United States. Many of those projects keep Grameen's emphasis on lending to women. Founded in 2008 and chaired by Yunus, the Yunus Centre in Dhaka is a think tank on social business, poverty alleviation and sustainability. It runs poverty eradication campaigns, research and publications, and support for social business start-ups. It also organizes the Global Social Business Summit and develops academic programs on social business with international universities. His microcredit concept also inspired programmes such as the Info lady Social Entrepreneurship Programme.

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• 4. Prizes and Praise

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  In 2006 the Nobel Peace Prize went jointly to Yunus and the Grameen Bank he founded, making him the first Bangladeshi to win a Nobel Prize. The citation praised him as a leader who turned visions into practical action for the benefit of millions of people. It added that "Loans to poor people without any financial security had appeared to be an impossible idea."

  Yunus announced that part of his share of the US$1.4 million award would create a company making low-cost, high-nutrition food for the poor. The rest would go toward Yunus Science and Technology University in his home district and an eye hospital for the poor in Bangladesh.

  Former United States president Bill Clinton had been a vocal advocate for the prize. He said so in Rolling Stone magazine and in his autobiography, My Life. In a 2002 speech at the University of California, Berkeley, Clinton called Yunus "a man who long ago should have won the Nobel Prize."

  The Economist took the opposite view. It agreed that Yunus was doing excellent work against poverty but argued that the Peace Prize was not appropriate. In its words, the Nobel committee "could have made a braver, more difficult, choice by declaring that there would be no recipient at all."

  Yunus is one of only seven people to have won the Nobel Peace Prize, the Presidential Medal of Freedom and the Congressional Gold Medal. The Presidential Medal of Freedom came in 2009, and the Congressional Gold Medal followed in 2010. His other awards include the Ramon Magsaysay Award in 1984, the International Simon Bolivar Prize in 1996 and the Seoul Peace Prize in 2006. The list also includes the World Food Prize, the Prince of Asturias Award for Concord and the Sydney Peace Prize.

  By the count in his record, Yunus holds 72 honorary doctorate degrees from universities across 27 countries. He has received 113 international awards from 26 countries, including state honours from 10 countries. The Bangladesh government issued a commemorative stamp to honour his Nobel award.

  In January 2008 the city of Houston, Texas declared the 14th of January Muhammad Yunus Day. In March 2012 Fortune magazine named him one of 12 greatest entrepreneurs of the current era. Its citation said his idea inspired countless young people around the world to devote themselves to social causes. In 2010 the British magazine New Statesman placed him 40th on its list of the World's 50 Most Influential Figures.

  On Google+, Yunus had over two million followers until Google closed the service in 2019. He appeared on The Daily Show with Jon Stewart and The Oprah Winfrey Show in 2006, and on The Colbert Report in 2008. Real Time with Bill Maher followed in 2009, and in 2010 he turned up on The Simpsons.

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• 5. On the World Stage

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  In 1996 Yunus served as an adviser to the caretaker government led by former Chief Justice Muhammad Habibur Rahman. He oversaw the Ministry of Primary and Mass Education, the Ministry of Science and Technology and the Ministry of Environment and Forests.

  In July 2007, in Johannesburg, Nelson Mandela announced a new group called The Elders. He did so in a speech on his 89th birthday. Mandela, Graça Machel and Desmond Tutu had convened world leaders to bring wisdom, independent leadership and integrity to some of the world's toughest problems. Yunus attended the launch and was a founding member. He stepped down in September 2009, saying the demands of his work meant he could not do justice to his membership.

  Yunus also belongs to the Africa Progress Panel, a group of ten distinguished individuals who advocate at the highest levels for equitable and sustainable development in Africa. Each year the panel releases the Africa Progress Report, which picks an issue of immediate importance to the continent and suggests policies. In July 2009 he joined the International Advisory Board of the SNV Netherlands Development Organisation. Since 2010 he has served as a Commissioner for the Broadband Commission for Digital Development, a United Nations initiative that uses broadband internet to speed social and economic development.

  In March 2016 United Nations Secretary-General Ban Ki-moon appointed Yunus to the High-Level Commission on Health Employment and Economic Growth. Presidents François Hollande of France and Jacob Zuma of South Africa co-chaired it. After the Rohingya genocide of 2016-2017, Yunus urged Myanmar to end the violence against Rohingya Muslims. Ban Ki-moon also invited him to serve as an advocate for the Millennium Development Goals.

  From 1998 to 2021 Yunus sat on the board of directors of the United Nations Foundation, a public charity supporting UN causes. He is a founding board member of Grameen America and the Grameen Foundation. In 2012 he became Chancellor of Glasgow Caledonian University in Scotland, a position he held until 2018. His board seats also include the Schwab Foundation, the Prince Albert II of Monaco Foundation and the Grameen Credit Agricole Microcredit Foundation. Since 2008 he has been a member of the honour committee of Fondation Chirac, launched by former French president Jacques Chirac to promote world peace.

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• 6. Years of Conflict

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  From the 2nd to the 4th of February 1997, Yunus held a microcredit summit, and he named Sheikh Hasina and the United States First Lady Hillary Clinton as co-chairs. Hasina praised "the outstanding work done by Professor Yunus and the Grameen Bank he founded." On the 26th of March 1997, the inaugural ceremony of Grameen Phone took place at her office. Hasina used it to make the first call, to Thorbjorn Jagland, then the Norwegian prime minister. When that conversation ended, she received a call from Laily Begum, a Grameen Phone employee.

  For many years Yunus had been a follower of Hasina's father, Sheikh Mujibur Rahman, a former President of Bangladesh. That connection continued after Mujib's death. In early 2006 Yunus joined civil society figures including Rehman Sobhan, Muhammad Habibur Rahman, Kamal Hossain, Matiur Rahman, Mahfuz Anam and Debapriya Bhattacharya in a campaign for honest and clean candidates in national elections. Later that year he considered entering politics himself.

  On the 11th of January 2007, Army General Moeen U Ahmed staged a military intervention, and Fakhruddin Ahmed took office as Chief Advisor. He said he intended to arrange free and fair elections and to clean up corruption. Khaleda Zia and Hasina criticised him, saying that cleaning up corruption was not his job. Yunus expressed satisfaction. Speaking to the AFP news agency, he remarked, "There is no ideology here." Hasina answered by calling him a "usurer who has not only failed to eradicate poverty but has also nurtured poverty." It was her first public statement against him.

  On the 11th of February 2007, Yunus published an open letter in The Daily Star. It asked citizens for views on his plan to float a political party to establish political goodwill, proper leadership and good governance. A week later, on the 18th of February, he announced that he was willing to launch a party tentatively called Nagorik Shakti. Some speculated that the army supported his move. On the 3rd of May, after meeting the head of the caretaker government, Fakhruddin Ahmed, Yunus declared that he was abandoning his political plans.

  The New York Times reported that Hasina's later actions looked like retaliation for his 2007 announcement that he would seek public office, even though he never went through with it. According to The Times of India, the Nobel Peace Prize was another factor. It was rumoured that Hasina believed she would win the prize for signing the 1997 Chittagong Hill Tracts peace treaty. On the 9th of March, Attorney General Mahbubey Alam said that Prime Minister Sheikh Hasina should have been awarded the Nobel Peace Prize. He went on to challenge the wisdom of the Nobel committee.

  On the 11th of January 2011, the second Awami League government announced a review of Grameen Bank's activities. In February 2011 international figures such as Mary Robinson stepped up their defence of Yunus. They founded a formal network of supporters called Friends of Grameen. On the 15th of February, Finance Minister Abul Maal Abdul Muhith declared that Yunus should "stay away" from the bank during the investigation. On the 2nd of March, Muzammel Huq announced that Yunus had been fired as managing director. Huq was a former bank employee whom the government had appointed chairman in January. Yet General Manager Jannat-E Quanine said Yunus was "continuing in his office" while the legal questions were reviewed.

  In March 2011 Yunus petitioned the Bangladesh High Court, challenging the Central Bank's decision to remove him as managing director. The same day, nine elected directors of Grameen Bank filed a second petition. On the 5th of March, United States Senator John Kerry said he was "deeply concerned" by the affair. The same day in Bangladesh, thousands of people protested and formed human chains to support Yunus. A hearing set for the 6th of March was postponed, and on the 8th of March the court confirmed his dismissal.

  On the 2nd of August 2012, Hasina approved a draft Grameen Bank Ordinance 2012 to increase government control over the bank. She also ordered a fresh investigation into his activities and finances during his later years as managing director. She alleged that he had received earnings without the necessary permission, including his Nobel Peace Prize money and book royalties.

  On the 4th of October 2013, the cabinet approved a draft law giving the central bank greater control over Grameen. The Grameen Bank Act 2013 passed parliament on the 7th of November 2013. It replaced the ordinance that had underpinned the creation of Grameen in 1983 as a specialised microcredit institution. The New York Times reported that the government planned to take over the bank and break it into 19 regional lenders. Borrowers owned most of its shares. Vikas Bajaj wrote that the law effectively nationalized the bank by taking control from the 8.4 million rural women who owned a majority of it.

  In all, Yunus faced 174 lawsuits in Bangladesh, and 172 of them were civil cases. The allegations included labour law violations, corruption and money laundering. Yunus said they were politically motivated. The first trial began in December 2010, with a claim that in 1996 he had transferred about $100 million to a sister company of Grameen Bank. Yunus denied it. The Norwegian government cleared Grameen Bank of all allegations of misused funds that same December. A second trial followed in 2013 over the earnings question. The series of cases puzzled figures from the millions of underprivileged women served by Grameen Bank to United States President Barack Obama.

  On the 27th of January 2011, Yunus appeared in a Dhaka court over a food-adulteration case. The charge was that a yogurt had a fat content below the legal minimum. It came from Grameen Danone, a joint venture between Grameen Bank and Danone, which aimed to give street vendors opportunities and improve child nutrition with fortified yogurt. His lawyer called the allegations false and baseless. That same month Yunus also appeared in a defamation case that a local politician from a minor left-leaning party had filed in 2007 over his remark to the AFP news agency. He was granted bail and exempted from appearing in person at later hearings. A three-month investigation launched in March 2011 kept him from attending the World Economic Forum. In 2013 a state-backed smear campaign accused him of being un-Islamic and of promoting homosexuality. It followed a 2012 joint statement, signed with three other Nobel laureates, criticising the prosecution of gay people in Uganda.

  On the 1st of January 2024, a Bangladeshi court sentenced Yunus to six months in prison for labour law violations, along with three employees of Grameen Telecom. The court granted bail pending appeals. Amnesty International called the conviction a "blatant abuse" of the justice system. The conviction was overturned on the 7th of August 2024. Four days after that acquittal, he was also acquitted in a graft case brought by the Anti-Corruption Commission.

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• 7. Chief Adviser

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  On the 8th of August 2024, President Mohammed Shahabuddin appointed Yunus Chief Adviser of Bangladesh, the head of an interim government. Sheikh Hasina had resigned, and Students Against Discrimination had called for Yunus to lead the country after the July Uprising. Yunus took the oath alongside 20 Cabinet Advisers, 8 people in Special Positions and 5 Special Assistants. He became the 5th person to hold the post.

  The Constitution of Bangladesh has made no provision for an interim government since 2011. The government is nonetheless deemed legitimate under the doctrine of necessity. Bangladeshi courts have taken the line that Hasina's resignation created a situation with no constitutional remedy, and that state affairs urgently needed oversight.

  After the oath, Yunus visited injured people at Dhaka Medical College. On the 10th of August 2024, he visited the home and family of Abu Sayed. He also visited injured student protesters at Rangpur Medical College. When communal violence followed Hasina's resignation, he threatened to resign if it continued and vowed to crack down on the conspirators behind the attacks. He pledged continued humanitarian aid to Rohingya refugees in Bangladesh. He also promised support for the garment industry, which had been disrupted by the unrest before his appointment.

  On the 16th of December 2024, Yunus announced that general elections would be held in late 2025 or early 2026. On the 5th of August 2025, he asked the Bangladesh Election Commission to organize the vote before Ramadan 2026, which could begin as early as the 17th of February. His government appointed a Constitutional Reform Commission and a National Consensus Commission to draft revisions to the Constitution. It also planned a referendum on the July Charter, to be held alongside the 2026 general election.

  In March 2025 Yunus announced that Bangladesh would finalize a commercial agreement with SpaceX's Starlink within three months. The aim was reliable satellite internet across the country, and protection against the internet blackouts that political disruptions had caused in the past. He said satellite service would widen access to education, health services and entrepreneurship in rural and underserved regions. In April 2025 he addressed the 81st session of the United Nations Economic and Social Commission for Asia and the Pacific. He reaffirmed a commitment to a climate-resilient and inclusive digital economy and highlighted investments in green infrastructure and sustainable housing.

  The July Charter is a political declaration built on a consensus among 30 political parties for constitutional, administrative and electoral reforms. Its discussions produced a plan for two houses of parliament. The Jatiya Sangsad would have 400 members. A new upper house, the senate, would have 100 members elected through proportional representation, plus 5 members appointed by the President. The senate cannot introduce legislation, but it can review bills, suggest amendments and delay bills passed by the national assembly.

  The administration announced that all buses in the capital, Dhaka, would come under a unified system, following routes and regulations set by the government. It installed semi-automatic traffic signals at key Dhaka intersections and announced plans for wider use. A real-time traffic monitoring centre also opened in Dhaka, equipped with technology for speed tracking, data analysis and incident management.

  Since 2009, under Sheikh Hasina's government, the National Human Rights Commission had been barred from investigating members of law enforcement. An ordinance issued by Yunus's government removed that ban. It gave the commission powers to investigate, prosecute and represent complainants, and to arrest and investigate suspects regardless of rank or political position. It can also visit and search facilities to identify secret detention centres, and issue warrants to inspect places where enforced disappearances could have occurred.

  Because of the police's history of human rights abuses, especially during the July Revolution, the administration vowed to make the force accountable. A police reform commission suggested clear-walled interrogation rooms in every police station to remove the risk of custodial torture. To prevent enforced disappearances, it recommended GPS trackers and bodycams, plus an independent police commission. The government announced that it would buy 40,000 bodycams for the police ahead of the 2026 general election.

  The government also launched mandatory pre-litigation mediation, in which a neutral third party helps disputing sides reach a resolution before a lawsuit is filed. It started e-family courts, which hold family court proceedings entirely online. It introduced a digital legal aid program offering free legal help to underprivileged communities. Law adviser Asif Nazrul said, "If implemented successfully, the amended legal aid system has the potential to transform lives."

  Critics faulted the administration for failing to maintain law and order early in its term. It earned praise for restoring freedom of the press and freedom of speech, for improving foreign relations and for carrying out key reforms, which brought a high approval rating. His name appeared on the 2024 list of The 500 Most Influential Muslims. In 2025 Time magazine named him one of the 100 most influential people in the world. On the 28th of February 2026, Yunus left the government residence after completing his duties as Chief Adviser.

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