Iqbal Quadir began to dream that a profitable company could be organized to provide telecom services throughout Bangaldesh, and it was clear that Grameen Bank would be key. The Yunus philosophy (handouts take away initiative and help maintain poverty)  fit his own notion that cellphones weren’t a luxury, but a necessary productivity tool. Yunus was not in the telecommunications business, but he had implemented a radical idea once. Why not entertain another? Yunus and Grameen Bank were icons in Bangladesh, and their credibility would be important in landing a license from the government–especially if Grameen could be induced to invest. Grameen would be a perfect first customer. Most important, Grameen had a rural branch operation in place.

One of the fundamental problems with development is that it’s hard to build new systems when basic systems aren’t in place. The Internet took off in America only after PCs, modems and digital phone lines were widespread commodities. In Bangladesh, state-owned phone BTTB, even if it had been convinced of the positive economics of rural telephony (which it wasn’t), may well have skipped rural areas due to the difficulties of sending people to live and work there. There aren’t enough roads to move about freely, banks to loan and collect, schools for children–and 80% of the country had no electricity. Who would leave the city to live in darkness with the poor and commit their children to inferior education? (Today, 70% of Bangladesh,s 144 million people still live without electricity, which, as you might imagine, opens up business possibilities for those who see the poor as eager consumers.)

Grameen Bank had somehow broken the back of the infrastructure dilemma and was providing development assistance throughout most of the country. Yunus had challenged the fundamental premise of bank lending, which held that only literate property owners could be expected to pay back a loan, and seen his idea take hold in the most remote villages. Grameen operated 1,000 branches, with 12,000 employees serving nearly 34,000 villages. (Today, it operates 1,735 branches with 16,000 employees serving 60,000 villages.) In a country with shoddy infrastructure, this was an amazing accomplishment. Few companies would be able to employ 12,000 people without a telephone system to connect them. More amazing, each week every Grameen creditor is in touch, theoretically at least, with a Grameen loan officer, a very high-touch operation. Beyond that, Grameen was a bank, which meant collecting and dispersing money was its business, and a phone company would need to collect fees on a regular basis.

Grameen is not a real bricks-and-mortar type of bank in a conventional Western sense. True, its Dhaka headquarters is an impressive 20-story glass building, the focal point of a complex that also houses Yunus’s modest two-bedroom apartment. But its 1,000 branch offices are typically small buildings or huts with filing cabinets, stacks of hand-written ledgers, and drawers filled with mone, and staffed by one manager. Grameen doesn’t bill on loan repayment; borrowers are expected to come in weekly and pay cash to the branch manager, who makes a mark in the ledger. The regional branch offices are now computerized and generate weekly statements; the local offices typically operate without electricity or computers, using old filing cabinets with hand-written ledgers as a database.