By: Rana Foroohar
July 8, 2010
An Asian bank for low-income women is out to teach Wall Street a lesson.
It's pretty safe to say that three years ago no one could have predicted that one of the few financial institutions to be opening new branches and expanding lending in America would be a Bangladeshi bank that specialized in loans to people below the poverty line (the vast majority of them women). But that's just what has happened. Grameen America, the U.S. offshoot of the famous Asian microlending institution founded by Nobel laureate Muhammad Yunus, is now in its third year of operation in America, and even as the major banks, still battered from the financial crisis, are keeping credit tighter than ever, particularly to the small and midsize businesses that need it so desperately, Grameen is expanding. This summer, the little Bangladeshi bank--already operating in New York; Omaha; and Washington, D.C.--will move into its fourth U.S. city, San Francisco, fueled by a series of loans from institutions like Wells Fargo and Capital One that, aside from basking in the glow of good PR, have realized that they are more likely to get their money back by lending to African-American hairdressers in Queens or Latina food-cart operators in D.C. than by chucking money at middle-class whites who have bought more McMansion than they can afford.