Build story · Bangladesh · 1976–2006
Grameen Bank: $27 that started microfinance
Economics professor Muhammad Yunus lent $27 to 42 village women. Grameen Bank grew into a lender to millions of poor borrowers, mostly women, and won the Nobel Peace Prize in 2006.
By Shivam Bhandari · Reviewed 31 October 2026 · How we write
by the numbers
- First loans (1976)
- $27 to 42 women
- Bank established
- 1983
- Nobel Peace Prize
- 2006
What happened
In 1976 Muhammad Yunus, an economics professor, met women in the village of Jobra who made bamboo stools but had to borrow from moneylenders at crippling rates. He lent $27 of his own money to 42 women.
Banks refused to lend to the poor without collateral. Yunus created a model of small loans to groups of borrowers, mostly women, who met regularly and supported each other's repayment. Grameen Bank was formally established in 1983 and reported high repayment rates.
Grameen grew to serve millions of borrowers, and microfinance spread worldwide. Yunus and Grameen Bank shared the 2006 Nobel Peace Prize. Later critics questioned high interest rates and over-indebtedness in parts of the microfinance industry.
Timeline
- 1976
Yunus makes first loans.
- 1983
Grameen Bank formally established.
- 2006
Nobel Peace Prize.
what made it work
- Served customers banks ignored.
- Group lending replaced collateral with trust.
- Focused on women borrowers.
the lesson
Customers everyone else considers too risky may be reliable if you design the product around how they live.
Apply it to your business
- 1Look at customers others refuse to serve.
- 2Design trust mechanisms instead of demanding collateral.
- 3Watch for unintended harm as models scale.
Laws at work in this story
Figures are rounded and drawn from public reports, company filings and widely cited coverage at the time. Check the company's latest filings before relying on any number.