Bank gives beggars phones instead of cash

DHAKA (Reuters) - Grameen Bank, famous for pioneering micro-credit programs in Bangladesh, has launched a new idea to empower the poor: arming beggars with mobile phones so they can sell a roving service for cash.


"Beggars are the one group so far left out of the bank's lending programme and they deserve to be part of our network," said Dipal Chandra Barua, deputy managing director of Grameen Bank


The bank, a brainchild of renowned Bangladeshi professor Mohammad Yunus, has been awarded many international awards for helping millions of poor with small loans to start income-generating programs, such as poultry and cattle breeding, and handicraft-making, and also helping to educate their children.


"Lives of these people have dramatically changed with each of the borrowers becoming self-reliant in a few years and living a decent life in their rural surroundings," he told Reuters on Saturday.


"Now for the beggars," said Barua.


Beggars would need to be a member of a Grameen Bank project to be eligible to get a mobile phone. Each mobile phone will cost them 8,500 taka (80 pounds), repayable over two years in interest-free instalments. They also are responsible for paying a subsidized monthly service charge of 152 taka.


The bank charges up to 10 percent interest on other credits.


"We won't ask them to stop begging immediately but would encourage them to ask people they stretch hands to if they need to make a phone call," Barua added.


"The money the beggars will get from calls would give them an extra income -- from which they will use a part to reimburse the cost of the cellphone to the bank."


The cellphone project would primarily target beggars in the rural areas where they earn much less than beggars in the cities, he said.


Grameen Bank believes its latest venture will be widely accepted and could change the lives of many of the country's beggars.


"We intend not only to help the old, homeless, jobless and people abandoned by their children, but also want to clean the streets of the sad scenes we see every day," he said.


"With the cell phones in hands, the beggars will ultimately give up their age-old profession on their own," the bank official said.


The bank will also provide 500 taka in cash to each "cell-class" beggar so they can sell snacks, chocolates, cookies and nuts for additional income.


Earlier the bank offered mobile phones to rural wives and mothers for commercial use that not only assured them enough money to survive but enabled some to earn an equivalent of $300-$400 a month, enough to buy land and even buy vehicles and start cattle farms.


Currently, there are 75,000 women, known as "phone ladies", with Grameen mobile phones across the country.


Ownership of mobile phones is still low in impoverished Bangladesh, a country of 130 million with per capita income of $444.


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