Analysis of Member Penetration

Data

World Resources Database

• 110,341,000 total population in 1991.
• 128,707,000 total population in 1998.
• 84% rural in 1991. 
• 78% rural in 1998.

1991 Census

• 19,398,000 households
• 85,359 villages

Grameen Websites

• 1,066,426 members in 1991
• 2,349,830 members in 1998
• 66,293 centers in 1998

% of Population

2,349,930 members / 128,707,000 population = 1.8% in 1998

This calculation seems to indicate a very low penetration rate. This ratio is not a good measure of penetration, however, because at most one person from each household can become a member. Grameen's strategy allows the number of members to be no larger than the total number of households.

% of Households

1,066,426 members / 19,398,000 households = 5% in 1991

This calculation shows a higher degree of penetration but is still underreporting. Grameen targets rural populations, targets the poorest 50% of the population, and is ineffective at reaching the poorest 10%.

Combining these figures, the number of households that fall within Grameen's target is:
19,398,000 * .84 * (.50 - .10) = 6,518,000 households

1,066,426 members / 6,518,000 = 16% in 1991

This calculation is still underreporting Grameen's penetration because the target is yet smaller than 6,518,000 households:

• The poorest 50% may include landholders who are therefore not Grameen targets.
• Not all of the rural population are in villages, which is where Grameen focuses its activities.
• Increasing numbers of the target population have already been members and left the Grameen Bank (typical membership is four years).
• Not all of the target population will be accepted by a group due to personal mistrust (lack of individual social capital) or are willing to join for personal reasons.
• Some of the target population take loans with other non-governmental organizations and government microcredit programs and are therefore unlikely to become Grameen members.

Also, although household data for 1998 is not yet available, the penetration in 1998 should be higher because:

• Grameen membership more than doubled between 1991 and 1998 while population only grew 16%.
• Rural % shrank from 84% to 78% between 1991 and 1998.

Centers Per Village

66,293 centers in 1998 / 85,359 villages in 1991 = 78%

This number most accurately portrays Grameen's penetration because it avoids all of the problems related to estimating the size of the target market of individuals or households. Almost any village could be a potential target for Grameen, making villages a fairly accurate measure of Grameen's potential for growth. Grameen means "village" in Bangladeshi.

The number of villages has probably increased slightly, which would make the actual penetration rate lower than 78% in 1998. If the number of villages grew at the same rate as population, then the penetration rate would be:

(66,293 centers / 85,359 villages) (110,341,000 1991 pop./ 128,707,000 1998 pop.) = 67%

There are therefore about two Grameen centers for every three villages on average in 1998.