CA Yunus Proposes Creation of Dedicated ‘Microcredit Bank’

Chief Adviser Professor Muhammad Yunus on Saturday emphasized the urgent need to establish a dedicated ‘Microcredit Bank’ to integrate microcredit into the formal banking system, moving beyond its current NGO-based model.

“We need to think innovatively — the time has come to set up a Microcredit Bank — as microcredit has reached new heights of success,” he said.

Professor Yunus pointed out that microcredit is still perceived primarily as an NGO activity, and transitioning it into a full-fledged banking institution would require a separate legal framework. “To become a real bank, we need a new banking law,” he noted.

Currently, microcredit organisations are only permitted to collect deposits from their own members, which he believes limits their potential. Expanding these capabilities, he argued, is essential to fully realizing the vision of a Microcredit Bank.

Highlighting the significance of microcredit, Yunus called for a future-oriented banking system built on trust — a model he believes microcredit exemplifies. “This is the right moment to discuss it,” he said, contrasting the sustainability of microcredit with the collapse of many conventional banks that were involved in public fund misappropriation.

He criticized the focus on what he termed “fake banks,” urging greater attention to institutions that operate transparently and serve real needs.

Professor Yunus made these comments while inaugurating the new headquarters of the Microcredit Regulatory Authority (MRA) in Agargaon, Dhaka. “It’s a pleasure to be here and reconnect with old colleagues,” he said.

Established in 1976, Grameen Bank — pioneered by Yunus — revolutionized the fight against poverty through microcredit and introduced a banking model rooted in trust and innovation.

Also speaking at the event were Finance Adviser Dr Salehuddin Ahmed, Chief Adviser’s Special Assistant Dr Anisuzzaman Chowdhury, Bangladesh Bank Governor Dr Ahsan H Mansur, MRA Executive Vice Chairman Professor Dr Mohammed Helal Uddin, and Financial Institutions Division Secretary Nazma Mobarek.

To regulate the operations of non-government microfinance institutions (NGO-MFIs), the government enacted the Microcredit Regulatory Authority Act in July 2006. The Act came into effect on August 27 that year, establishing the MRA to ensure transparency and accountability across the sector.

The MRA is tasked with implementing this regulatory framework and overseeing the development of a more structured and credible microcredit system in Bangladesh.