Bangladesh bank offers loans to US poor

[ckramer]

Source: FT

Bangladesh’s Grameen Bank has made its first loans in New York in an attempt to bring its pioneering microfinance techniques to the tens of millions of people in the world’s richest country who have no bank account.

The bank’s entry into the US, its first in a developed market, comes as mainstream banks’ credibility has been hit by the mortgage meltdown and many people are turning to fringe financial institutions offering loans at exorbitant interest rates.

...

In the US, about 28m people have no bank accounts and 44.7m have only limited access to financial institutions. People often do not hold bank accounts because they have had credit problems, have no access to a local branch or they distrust the mainstream financial system, said Jonathan Morduch, a microfinance expert at New York University.

Read more: http://www.ft.com/cms/s/0/a612164c-dbf8-11dc-bc82-0000779fd2ac.html?nclick_check=1

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America now officially a 3rd world country!

[intaglio]

1. If the US were an honourable Japanese

now would be the time to commit sepuku

[freedomnorth]

2. How do this 28m people get their salaries?

In an envelope?

[sicksicksick_N_tired]

3. Incredible.

That simple for you, huh.

Too bad. ;(
More likely than not you, too, will get caught in a more complex experience than you presently comprehend. Not that I am wishing that upon you but, it seems, there are those who do require real-life experience before they are able to comprehend the facets of living.

[Mik T]

4. They have to pay a fortune to cash their checks

Maybe you live inside a bubble?

Ever been in a crappy neighborhood and seen those little store fronts where it says things like Checks Cashed in big neon yellow letters?

They are particularly big in army base towns.

The poor sap who has to go to one ends up paying up to 20% of his check to cash it. It sucks.

[sicksicksick_N_tired]

5. Welcome to DU. Yes, those loan sharks are popular in military base towns.

No one ever mentions the fact that,...our US economy hasn't provided a job for every working citizen, E-V-E-R,...never NEVER, ever. At least tens of millions have always been left behind and, most of the time, it has nothing to do with lack of drive or intelligence but rather circumstances beyond those people's control.

Anyone who ever pretends like living in this country is easy, "if you just try", has obviously never been anywhere near as challenged as the tens of millions that person so easily condemns. Only experience teaches understanding of difficulties to those who have more to be grateful for than they presently acknowledge. Of course, there are those who will never gain that understanding, whether by nature or nurture.

[freedomnorth]

7. I beg your pardon

My question rose out of curiosity, not condemning. I myself live in europe and I have seen this check you speak of only once. It is not that I am of high class, checks are simply not used anymore. Everyone has bank account in my country.

As of being unemployed I am one. So i guess I am as poor as you can be in first world.

I beg forgiveness for my question was not meant to mock anyone. I just did not have this knowledge of U.S. situation.

There is always problem of scarcity if there is no readily available workforce. That is why having too few unemployed would rise their price too high. That is not suitable for rich.

[izquierdista]

9. Americans are touchy

When asked about the failings of their society. It used to be that employers paid in cash and the common laborer didn't need a bank account. But that didn't bring in much revenue for the financial services industry, so they did the American thing and advertised how safe and better the situation would be if only employers used their services and issued checks. So now, the poor have no alternative but to be reamed every time they need to cash a check.

It's not just financial services where the poor get stuck paying more and getting less service that makes Americans grouchy. The same thing will happen if you recommend that these same poor people go to the National Health Service if they have a medical problem.

Now for you Americans inside the fishbowl, who will get irate and condemn people looking in who have reasonable questions, like "why don't you have your act together", you could instead try to solve the problem. But from the tone of this article, it looks like the third world will have to step in with revolutionary new ideas to help America's poor, apparently the free market sees no need for it.

[Mik T]

12. I just didn't think the person was from another country

I just thought the explanation was that he or she was a spoiled rich brat who never left the suburbs. Apologies to the european in question for snarling. I get into the habit of thinking everyone on this board is a resident of the USA.

And being a member of the Poor People's Economic Human rights Campaign- I think I do a fair amount to try to change what's going on in my country.

And, yes, the help of other countries is useful. We need to learn some revolutionary spirit here. If we looked at what they do in Latin America It would be an inspiration. Of course- they don't teach that in schools. There is pretty much a media blackout when it comes to the successful activism of our friends in the south.

CHavez is suppossedly evil and Mexicans are all to be hated for stealing our jobs. Thats about all the average person on the street knows about our neighbors.

I think the problem might be that because schooling is so easy to come by here, most people lose interest in learning at a very young age. The people I have met from south and central america seem to have more of a drive and a thirst for knowledge. I guess its because they haven't spent their whole life being handed bulls*&T on a plate by their so-called teachers.

[NYC]

18. Welcome to DU.

:hi:

[truedelphi]

6. Once your credit sucks enough,you can't even get work

Medical bankruptcy knocked me and the hubby off the middle income earner grid.

I quit working my $ 200 a week job to take care of him.

(He was newly blind at the time.)

Now I can't re-enter the work force - a credit check is run on you, and if your rating is in the negative 1200's (as ours must be) that's it, you will not even be called in for an interview.

They consider those of us with bad credit scores to be drug users, or gamblers.

or worse. If I ever do get work, I have to hope that I am paid in cash, or that I am able to physically travel to the bank branch where the check is cashed. (Once your credit is this bad you are introuble with CASHEX. They forbid the banks to let you have an account.)

I seriously believe that in five years there will be prisons for those with such bad credit ratigns.

And <sigh> until I experienced it, I would never have thought that one eleven month illness could wipe a family out. Taking its retirement ssavings, etc.

[kineneb]

15. we went through medical Ch. 7 as well

cashed out everything to get medical care for Hubby before he could get on disability (renal failure)...and we are now paying my family back for the court Trustee's bill...

We are lucky to live in a rural area where personal references still count. The bank thing is weird, we still have the same account as before. I don't know about jobs; I am trying to get on SSI disability for my own issues. Welcome to the Underground Economy, where cash and barter are your friends.

[Viva_La_Revolution]

13. The cash checks at Grocery or Payday loan stores.

some have friends with bank accounts that will cash checks for them, but that's getting harder as Bank are cracking down on 3rd-party checks.

[NashVegas]

14. They're Required to Give a Thumb Print

I once tried to cash a 3rd party check at the bank of the issuing party. When I saw what they wanted of me, I refused and brought the check to my own bank.

[diane in sf]

8. I've donated to these people, they're great. I could have used help like this

when I was starting out and the economy was rotten. Even a college degree won't help if you are in a nasty economy and don't have connections or aren't floated till you can get established. The thing that let me get started working for myself was that one of my friends died and left me $3k in 1992 so I was able to get a used computer. I had no credit, no savings because I wasn't really making enough to live on till then. That let me get started doing professional work and eventually teaching college which doesn't make me rich, but I enjoy it a lot.

The Grameen bank helping with loans and Chavez helping with heating oil should set an example for institutions here about better helping people.

[tom_paine]

10. Yes, Amerika has been a Thrid World Nation since 12/12/2000.

We are just waiting until the corpse-stench of our dead democratic-rerpublic reeks more than the window-dressing put on Amerika's new totalitarianism, so very similar to what is practiced in Russia and China, cannot cover the stench of decay any more.

[burrowowl]

17. Longer than that

since RayGun!

[AzDar]

11. Okay. Goddamn. There's a headline I certainly never expected to see.

:crazy: BushWorld...

[and-justice-for-all]

16. http://www.grameen-info.org/

[Arctic Dave]

19. I'm reading a book about this

right now "Banker to the Poor". It's really good. I have a tremendous amount of respect for the people who brought this bank together.

[JCMach1]

20. How far we have fallen...

[ileus]

21. And Grameen is going to learn the same thing US banks have....

the poor don't pay back loans...