Muhammad Yunus, founder of Grameen Bank, presented social business as a way to use business principles to address the needs of those living in poverty. “A social business is a selfless business,” said Yunus, whose objective is to solve a social problem rather than to return profits to investors. Yunus recommended that MFIs stay focused on providing financial services to their clients, but that they help create other social businesses to address other challenges that their clients face. “When you break down big problems into their components, they become solvable,” Yunus continued, “and if you address it through the social business model, it becomes sustainable.”
An interview with Muhammad Yunus, founder of Grameen Bank. Download a transcript of the video [PDF].
Yunus sees two different type of social business:
Type 1 – A no-profit, no-loss company to which the initial investment is paid back, but investors cannot receive dividends.
Type 2 – A company owned by the clients it seeks to serve.
CARD MRI in the Philippines, has set up the various mutually reinforcing institutions in the CARD family of companies as type 2 social businesses, owned by their members. CARD today has 12 “mutually reinforcing institutions,” which are separate businesses whose managers meet together regularly to decide how they can support each other’s work. CARD’s MRIs include health facilities, (health insurance, a pharmacy, and a medical lab), five financial institutions (a microfinance NGO, a microfinance bank, a rural bank, an SME bank, and a leasing company), an insurance agency, a technology company, a marketing company, and a training institute.
Learn more about CARD’s 12 mutually reinforcing institutions
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Table of Contents
- Executive Summary
- Taking Steps to Target the Poorest
- A Global Context for Extreme Poverty
- Microfinance & Health Providers Can Partner for Greater Results
- Commercial & Social Businesses Can Expand Value Chains to Include Those in Poverty
- Mobile Network Operators Can Build Systems that Reach the Poorest and Most Remote
- Regulators & Policymakers Can Build a National Ecosystem for Inclusion
- Social Support Payments Can Become a Bridge to Financial Inclusion
- Being Accountable for Results
- A Commitment to End Extreme Poverty by 2030
- Read the Full Report
- Get Your Copy