Page 154 - Social Enterprise A New Business Paradigm for Thailand

designed to incubate small-scale social enterprises and enable them to survive in the marketplace.
Accordingly, this chapter gives particular attention to the case of Grameen Bank. A secondary

objective is to examine the role of social enterprises abroad, both in developing and developed
countries, by presenting successful examples that focus either on improving quality of life or on
broader social development, with the goal of inspiring future social entrepreneurs.

5.1 Social Business Prototype: Grameen Bank

Muhammad Yunus founded Grameen Bank, a financial institution for microborrowers and a
community development bank. This innovative model empowered millions of women in
Bangladesh and was later replicated in many other countries, significantly contributing to poverty
alleviation and women’s empowerment. Yunus pioneered the concept of providing small loans to
the poor without requiring collateral. His approach gave Bangladeshi women greater agency,
leading to increased household income and improved family welfare, reflected in an impressive

repayment rate of over 98 percent (Yunus with Weber, 2017). Thanks to the effectiveness of its
group lending model in delivering clear, tangible results in the fight against poverty, both
Grameen Bank and Yunus were jointly awarded the Nobel Peace Prize in 2006.

Box 5.1 Biography of Muhammad Yunus

Muhammad Yunus was born on June 28, 1940, and is globally recognized as an economist, a social
entrepreneur, and a banker to the poor. He is a Bangladeshi national who, along with the Grameen Bank
he founded, was awarded the Nobel Peace Prize in 2006. Yunus was born into a middle-class family; his
father was a jeweler. He received a Fulbright scholarship to pursue a doctorate in economics at
Vanderbilt University. After completing his studies in 1972, he became the head of the economics
department at the University of Chittagong.
He began working with local communities during the major famine that struck Bangladesh in 1974.
Yunus discovered that the poor were being exploited by predatory moneylenders who offered small
loans at exorbitantly high interest rates. Even as a university professor at the time, he was able to
alleviate the suffering of these individuals using a small amount of his own money. This experience
turned him into a social activist and ultimately led to his founding of a bank for the poor.
Yunus believes that the current capitalist system is the root cause of poverty, exploitation, inequality,
and the depletion of natural resources. He is therefore committed to redesigning the global economic
framework. In his view, the mechanisms driving the global economy today not only fail to solve these
problems, they often exacerbate them. He argues that we must move away from market systems rooted
in the pursuit of maximum profit and toward social business models. This shift, he asserts, requires a
fundamental rethinking in three key areas:
1. Reframe the concept of social business in direct opposition to classical economic theory, which
holds that self-interested individuals can generate efficient economic mechanisms and elevate
overall social welfare. Yunus believes that humans are capable of creating social businesses rooted
in selflessness, enterprises that can drive both the economy and society toward a better future
while addressing the pressing problems of our time.

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