State and central governments have enacted laws putting a ceiling on interest rates that private parties can charge. Yet, credit card legislation and RBI rules allow companies to bypass these limits.
Microfinance has given a huge push by giving a Nobel Prize to the founder of Grameen Bank Mohammed Yunus. Grameen Bank was touted as an example for the world but the Bangladesh government has charged the bank of harassing and intimidating Bangladeshi workers. Here is an excerpt from a The Hindu article from which it is possible to determine who are the real backers of the Grameen Bank. It is quite obvious that Mohammed Yunus is just a front man. (The Hindu; Bangladesh: crisis of the Grameen Bank; 4 April 2011; http://www.thehindu.com/opinion/lead/bangladesh-crisis-of-the-grameen-bank/article1599780.ece)
Meanwhile, Dhaka is facing a strong reaction from the West, particularly the United States. The U.S. has called for a dialogue and compromise between Dr. Yunus and the Hasina government for an “honourable solution.” “A compromise is possible and I am encouraging dialogue between the parties to find a mutually acceptable solution,” Robert Blake, Assistant Secretary of State for South and Central Asia, told a news conference. “If there is no compromise, it will have an effect on bilateral relations,” said the senior official, who was in Dhaka recently to demonstrate Washington’s strong backing for the Nobel Laureate.
The former World Bank president, James Wolfensohn, was also in Dhaka to back Dr. Yunus, who has strong admirers in the West. “Friends of Grameen,” another powerful international backer, came out strongly against the Hasina government. Sa-dhan (the association of Community Development Finance Institutions consisting of over a hundred microfinance practitioners and experts of India) has also lent full support to Dr. Yunus.
Secretary of State Hilary Clinton personally communicated her concern to the Bangladesh Prime Minister and talked to the embattled microcredit pioneer, who is a close friend of the Clinton family. Re-emphasising the U.S. concern, Mr. Blake said “we in the United States have been deeply troubled by the difficulties he is currently facing.”
The fact is the present government is not very appreciative of Dr. Yunus’ contribution to poverty alleviation through the microfinance model, although Sheikh Hasina in her first tenure attended the world microcredit summit at the United Nations where he got the world body’s support. The Prime Minister has accused him of treating the Grameen Bank as his “personal property” and claimed that the group is “sucking the blood of the poor.”
A host of studies have disagreed with the claim that microfinance is a panacea for poverty. Many have even called the model a “villain.” But Dr. Yunus has the support of many important sections, particularly from the world’s powerful lobbies. In any case, the present crisis is not over the microfinance model but with his becoming the life-long Managing Director of a bank that is allegedly flouting the law.
But the West’s support to him is so loud that, it appears, even if the final court verdict goes against him, a negotiated settlement may be found so that the Nobel Laureate’s image and his contribution to the institution are well protected, and the independence and smooth functioning of the Grameen Bank remains undisturbed.
Yunus, who was 70, at that time refused to quit as the head of the bank when rules stipulate an age limit of 65.
Before Grameen Bank, there was a CIA drug money laundering outfit called BCCI. It pretended to be a MFI but its cover was blown as a CIA front. Scores of people were suicided including a former CIA director. Here is the opening paragraph of an article on BCCI-CIA saga on FAS.org.
The relationships involving BCCI, the CIA, and members of the United States and foreign intelligence communities have been among the most perplexing aspects of understanding the rise and fall of BCCI. The CIA’s and BCCI’s mutual environments of secrecy have been one obvious obstacle. For many months, the CIA resisted providing information to the Subcommittee about its involvement with and knowledge of BCCI. Moreover, key players who might explain these relationships are unavailable. Some, including former CIA director William Casey, and BCCI customers and Iranian arms dealers Ben Banerjee and Cyrus Hashemi, are dead. Others, including most of BCCI’s key insiders, remain held incommunicado in Abu Dhabi. While promising in public hearings to provide full cooperation to the Subcommittee, to date the Abu Dhabi government has refused to make any BCCI officers available for interview by the Subcommittee. Former BCCI chairman Agha Hasan Abedi remains severely incapacitated due to a heart attack. Finally, some persons in a position to know portions of the truth have denied having any memory of events in which they participated and of documents which they reviewed
BCCI was a front of Rothschilds. CIA is muscle-arm of the Rothschilds.
Though BCCI was created by a Pakistani, it was ultimately a British-based and British-controlled bank. BCCI was initially incorporated in Luxembourg, famous for its lax banking restrictions, and soon branches and holding companies sprouted up around the globe: in the Cayman Islands, the Netherlands Antilles, Hong Kong, Abu Dhabi, Washington DC and just about everywhere else.
In 1976, BCCI took over the Banque de Commerce et Placements of Geneva, Switzerland, and then installed Alfred Hartmann as manager. Hartmann then became the chief financial officer for BCC Holding, and thus one of BCCI’s most influential directors. Hartmann was also president of Rothschild Bank AG of Zurich, as well as vice-chairman of NY-InterMaritime Bank of Geneva, run by Mossad operative Bruce Rappaport, who was on the board of N.M. Rothschild and Sons in London. By 1980, when BCCI finally applied for and received a licence from the Bank of England, there were already more branches in the UK than in any other nation.
BTW, NSA leaker Ed Snowden’s favorite leaker Glenn Greenwald’s new financial backer and eBay co-founder Pierre Omidyar is another big investor in MFIs in India.