Grameen’s success is particularly astonishing when one considers the context of banking and lending in Bangladesh. Traditionally, banks in Bangladesh lend only to wealthy families and businesses, because only these groups have collateral. Ironically, these banks have recovery rates that range from 45 to 50 percent. In fact, the majority of traditional banks in Bangladesh survives only by virtue of the fact that they are owned by the Bangladeshi government and are the recipients of substantial subsidies from it. Not only has Grameen outperformed traditional banks, it has done so while lending to the very poor, in a country in which the poor have traditionally been overlooked and neglected.
Grameen has reaped these successes thanks to its emphasis on social development, making its exchanges beneficial for the recipients of loans as well as the bank. Yunus has explained that he does not believe charity is the answer to poverty. Charity, Yunus explained, furthers poverty by creating dependency. After all, to attempt to solve poverty by giving money and other resources to the poor without equipping them with the ability to earn for themselves is to make them dependent upon said charity. In addition to relegating the poor to a position of dependency upon others for a better quality of life, Yunus has explained he believes charity takes away from their ability to take the initiative to break through poverty on their own. Yunus believes that the creative application of energy is the way out of poverty. He has also stated that “the myth that credit is the privilege of a few fortunate people needs to be exploded.”