ISLAMABAD, Dec 15: Micro credits can bring revolutionary changes to the lives of people in the rural areas and help in creating new jobs.

This was stated by the founder of the Bangladesh Grameen Bank Prof Mohammad Younas at a business breakfast talk on "Changing face of micro finance" here on Wednesday.

He said Bangladesh and Pakistan, where a large segment of the population lived in rural areas, could greatly benefit from micro financing. Bangladesh has already brought some good changes in the lives of women in the rural areas by providing them small loans, he said.

He said the Grameen Bank was turning away from conventional banking and was financing every need of the rural poor, besides providing them an opportunity to participate in various economic activities like launching of small-scale businesses.

Women, he said, were the primary target of the bank because they were the deprived segment of society. That's why 96 per cent of the loans were disbursed among women, he added.

The bank also provided interest-free loans to beggars to rehabilitate them and make them positive members of society. So far, he said, small loans had been disbursed among 24,000 beggars. If even half of the beggars started their own work, it would be the biggest achievement.

About the overlapping of loan (cross financing), he said it was not bad if a woman had acquired loans from different branches of the bank "because if she needs more money for running a business there is no harm to get loans from more than one branches".

Zari Taraqiati Bank President Istiqbal Mehdi said about 32 per cent of the country's 149 million population lived below poverty line and there was a consensus that micro finance sector should be developed at a quick pace to maximize and sustain economic growth to reduce poverty.

He said at present micro finance providers served only an estimated 5 per cent of the 6.5 million poor households badly needing micro finance services. The interest rates on micro financing, he said, should be reviewed and its outreach be expanded to serve larger segments of society by adopting participatory development approach to identify real services/areas and to increase the spectrum of activities and financial services.