Grameen Bank pioneered the modern microfinance institution in Bangladesh in 1983. Its founder, Muhammad Yunus, developed the model from a rural-credit project that began in 1976.
Yunus launched the project while teaching at the University of Chittagong, initially testing small, collateral-free loans in Jobra village. The approach targeted poor borrowers—especially women—who were often excluded from conventional banking. Instead of requiring conventional collateral, Grameen used group-based lending and regular repayment structures.
The 1983 Grameen Bank Ordinance converted the project into an independent bank. The name Grameen means “rural” or “village” in Bengali. Grameen Bank is therefore a bank and statutory public authority, not a conventional private company—a useful distinction behind the question’s wording.
Its influence spread far beyond Bangladesh. In 2006, Grameen Bank and Yunus jointly received the Nobel Peace Prize for their efforts to create economic and social development from below. Microfinance now covers many institutions and approaches, but Grameen remains the best-known pioneering example.