The international microcredit institution Grameen Bank expanded its American portfolio this week, opening a branch in Oakland, Calif.
The branch will be a first West Coast location for Grameen, first established in 1976 with a $27 loan to Bangledeshi villagers given by the bank’s founder, Muhammad Yunus.
Yunus’ lending has since won him the Nobel Peace Prize. His model consists of giving very small loans at low interest rates to poor entrepreneurs, who generally live in the developing world and lack access to conventional bank loans. By lending a beggar as little as $10 to buy, for instance, a loom to make textiles or a cow to make milk, microcredit bankers like Yunus are revolutionizing the way poor people, and especially women, sustain themselves in some of the world’s hungriest places, as Ariella Cohen reported for Next American City in 2009.
In 2008, the first Grameen America branch opened in the Jackson Heights neighborhood of Queens, N.Y. A dense neighborhood with a large, thriving population of immigrants from India, Pakistan and Bangladesh, Jackson Heights was a logical proving ground for the microcredit model. The average loan size in 2009 was $2,200.
Grameen America has expanded aggressively since then, with locations in four out of five New York boroughs as well in Indianapolis, Omaha and the latest, in Oakland. At last count, the organization counted in its portfolio nearly 10,000 borrowers carrying over $34 million in loans.
The last branch to open (in Omaha, Neb.) has distributed over $5 million in loans to 1,280 borrowers since 2009, Grameen America reports.
Yet even with these seven locations established and two more on the way, targeted for opening in Pennsylvania and Virginia, Grameen America handles a miniscule percentage of micro-loans distributed globally. According to the Microcredit Summit Campaign Report 2012, just 148,628 clients — as of 2009 — came from North America and Western Europe, compared to over 190 million worldwide.
It’s not surprising that Yunus chose to expand his American operations while President Obama is in the White House.
Obama’s late mother, S. Ann Dunham Soetoro, dedicated much of her career to developing microfinance programs in Indonesia, and while Yunus and Soetoro never met in person, the microfinance pioneer knew Soetoro’s legacy well before Obama stepped onto the national political stage. Already, this legacy has begun to be realized through the actions of the new president. The Recovery Act Obama signed into law in February  provided $50 million in microlending funds over the next two years, stimulus money that will go out through state Small Business Administration offices, on top of another $21 million allocated in the year’s federal budget to the SBA’s micro-enterprise programs.