Earlier today the Norwegian Agency for Development Cooperation (Norad) cleared Grameen Bank’s moves to supply its private arm with development funds targeted for its non-profit works.
The Minister of the Environment and International Development, Erik Solheim, the official who commisioned a Norad report on this affair offered this assessment:
“There is no indication that Norwegian funds have been used for unintended purposes, or that Grameen Bank has engaged in corrupt practices or embezzled funds. The matter was concluded when the agreement concerning reimbursement of the funds was entered into in May 1998 under the government in office at the time.”
The aid organization has cleared the allegation. The Ministry of Development, likewise it seems. One wonders though: has the domestic and international political fall-out from this episode been accounted for?
Both Sheikh Hasina and Foreign Minister Dipu Moni are on the record publicly blasting Dr. Yunus. The foreign markets and other aid organizations might take some time to get in cozy with Grameen, especially since this affair has brought to the surface problems with the business model. The conspicuous moves in India have already become married to Grameen’s founding and public branding narrative and, as such the news from Andhra Pradesh signal the need for wholesale revision of the public and private micro finance industry.