Nobel laureate calls for reforms in global banking sector

Nobel Peace Prize winner Muhammad Yunus has called for reforms in the global banking sector to solve social problems through financially self-sustainable models.
Addressing an event here, Yunus highlighted how the global financial crisis had uncovered serious shortcomings in the global banking system, including irresponsible behaviour by individuals who influenced the marketplace.
The economist, who had won the 2006 Nobel Peace Prize for his work in building the micro finance provider Grameen Bank in Bangladesh, said that now is the an opportunity to correct mistakes and redesign the global financial system.
Yunus said the answer to this global challenge is through 'Social business', which he defines as a company with the sole purpose of solving a social problem in a financially self-sustaining way, rather than purely pursuing profits.

Known as 'the world's banker to the poor', Yunus said that the Islamic banking sector was well placed to embrace 'social business' because of its ethical roots.
He alluded to his experience at Grameen Bank, which provides credit to the poorest in Bangladesh, without any collateral as means to combat poverty.
"All companies that are trying to do social good need funding to survive - that gives banks a key role in the development of social businesses. This could be funding a company that provides renewable energy, health care or IT to the developing world, as well as funding a company that provides micro finance to the local community," he added.