Must be. Otherwise why would city officials and Uptown insiders be dancing with Grameen America?

In an all-time financial whiplash move, the microfinance outfit which got its start in Bangladesh loaning money to widows to bake bread or dig wells is looking to open up shop in Charlotte. The same Charlotte that until 12 months ago was one of the financial capitals of the world.

Does Eastover know about this? Can you get a microloan for Botox injections?

A couple weeks ago President Obama awarded Grameen Bank founder Muhammad Yunus the Presidential Medal of Freedom, citing his company’s work lending $2.3m. to 1000 borrowers in Queens and Omaha. Yunus and Grameen also won the Nobel Peace Prize in 2006. Yunus holds that access to credit is a “human right.”

A big part of Grameen’s approach is the old fashioned due diligence on borrowers that bankers used to exercise, actually meeting them and checking up on their plans and progress. Grameen also actually trains its borrowers on how to be borrowers, another common-sense thing banks used to do before mergers mattered more than good customers. As a result, the repayment rate of Grameen’s modest loans of a couple thousand dollars has been very high, both overseas and thus far in its fledgling US operations.

But let’s put this in perspective. One million dollars in microloans, while welcome, is not going to make or break Charlotte’s economy. Plus if Omaha is any guide there are restrictions on how the money can be used. The World Herald interviewed Grameen America official Habib Chowdhury for details:

To qualify for a loan, borrowers must form groups of five women from the same neighborhood. They must use the money for some type of entrepreneurial activity.

Grameen says it doesn’t determine creditworthiness by collateral. Instead, loans are issued “based on trust and commitment — nothing more.” …

Nineteen groups of borrowers have been formed in Omaha, Chowdhury said. With some of the money, women have started a cosmetic sales business and have purchased sewing machines or cleaning supplies to start their own companies.

Ninety-five percent of loan recipients have been immigrants, primarily from Latin America, Chowdhury said.

Borrowers can get loans for up to $1,500 in the first year and are eligible for larger loans after the initial loan is paid off. Loans have a six-month or one-year repayment period and interest rates of 7.5 percent or 15 percent.

Borrowers make weekly payments of 2 percent of the original loan amount plus interest, Chowdhury said. They also are required to save at least $2 per week, which is deposited in a savings account.

[Tonya] Ward and four other women formed the Grameen-Rosenblatt Women’s Association in early July, and each woman received a $1,500 loan.

Ward said she used the money to join the Greater Omaha Chamber of Commerce and several women’s business groups. She also used a portion of the money to become a Mary Kay cosmetics consultant to earn income while she works on Energy Rescue.

Energy Rescue is a non-profit formed to help folks pay their energy bills, which points to the fact that Grameen money does not always end up in entrepreneurial efforts and instead gets sucked into back the poverty industry.

Still, Grameen would probably be a net good for Charlotte, provided the “human right” to credit did not cross-pollinate with the radicals over at NACA. Just keep in mind the irony in publicly declaring Charlotte “unbanked” after all these years of being up to our eyeballs in bankers.

Bonus Observation: Pretty much guaranteed that the Charlotte Chamber would jump up and down over a local Grameen shop if folks in Omaha have used Grameen money to pay Chamber of Commerce dues.

Update: An unnamed co-conspirator send along a link to this Mises.org piece from 2006 by Jeffrey Tucker. On the occasion of the Nobel award, Tucker offered a serious critique of the Grameen model and practice entitled Microcredit or Macrowelfare: The Myth of Grameen. Every city official should read it before deciding to get into bed with Grameen.