Microcredit needs separate regulator: Nobel laureate Muhammad Yunus in Cairo
Egypt needs a separate regulator, legal framework and an integrated strategy for microfinance to be able to reduce poverty, said Nobel laureate Muhammad Yunus in Cairo on Sunday.
The founder of Grameen Bank explained how it was necessary for Bangladesh to create a micro-credit law in 1983 to allow for micro-credit institutions to expand.
“You cannot create the bank of the poor with the same architecture as the bank of the rich.”
Yunus also advised for a separate regulatory authority to oversee microcredit institutions than the one regulating conventional banks. “They will not understand the philosophy or the procedures of this (Grameen) bank,” he said.
"The reason why microfinance has failed to take off in Egypt is because those in charge of financial decisions are bankers who do not believe in microfinance one bit," said Ahmed El Bardai, former Banque du Caire head and founder of Reefy, the country's first private sector microfinance lender.