Case Name :      Contrasting China’s Yunan Model with Bangladesh’s Yunus Model for Microfinance

Authors :           Yuping Du, Randall O. Chang, Meng Wu, Chun Li

Source :             Ivey Publishing

Case ID :            W13266

Discipline :        Finance

Case Length :    09 pages

Solution Sample availability : YES

Plagiarism : NO (100% Original work)

In 2008, about the time when the Yunus Model of microfinancing was under attack in its home country of Bangladesh, the Yunan Model was begun in rural China. The original model suffered from inefficiencies, high interest rates and allegations of improprieties against the founder, Nobel Prize winner Muhammad Yunus. By contrast, the Yunan Model relied on social capital and mechanism design theory to enlist the rural population, financial institutions and government in a cooperative effort to increase the financial stability and entrepreneurship level of one of the poorest areas of the country. Could “microfinance with Chinese characteristics” offer a plan to reduce poverty across China?