Major Teoh’s Blog

January 19, 2007

Grameen Banking System

Filed under: Finance — Major (Rtd) Teoh @ 9:16 am

Grameen Banking System

This Grameen Banking System will work in a country where the customers are grateful for what you give them and are willing to pay back what they owe.This may not work in Malaysia. What is sauce for the goose may not be sauce for the gander. What works elsewhere may not necessarily work here.Take for example the MARA loan; the Higher Education Loan and other loans dished out by other agencies and organisations. Most of these loans are never serviced and repaid. Even with the threat of legal action and the threat of publishing their names in the papers, do not make them budge an inch. Ah Longs too are at wits end when it comes to recovering their loans, if not why do you think they resort to high handed tactics to recover their loans.I watched the interview of Nobel laureate Muhammad Yunus, the Bangladeshi economist and Owner/CEO of Grameen Bank at the award presentation over the CNN. Muhammad Yunus said that 98% of the loans given out were recovered and 2 % came back to have their loans restructured. Strangely enough most of their customers are the women folk.On another point, he said that though few in number, bad loans were never written off as this would encourage customers to abscond. But instead, it is set aside and fresh loans were given out for the financially troubled customers to start again in business. It is only when they are on their feet again then only, are they made to service the old loans.Sometimes I use to wonder whether this will work in Malaysia when given such a scenario. Sorry, I cannot help but being pessimistic over the whole issue. Just wondering.Regards,Major (Rtd) Teoh


Leave a Comment »

No comments yet.

RSS feed for comments on this post. TrackBack URI

Leave a Reply

Please log in using one of these methods to post your comment: Logo

You are commenting using your account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

Blog at

%d bloggers like this: