Grameen’s famous Village Phone Program lifted thousands out of poverty– and helped Muhammad Yunus win the Nobel Peace Prize. The problem: It’s not working anymore.
According to Grameen Telecom, the GrameenPhone affiliate that manages the program, profits per operator have been declining for years and in 2006 averaged less than $70. “The program is not dead,” says its manager, Mazharul Hannan, chief of technical services at Grameen Telecom, “but it is no longer a way out of poverty.”
The reason is simple: Technology and GrameenPhone itself have made the village phone obsolete. Access to cell phones has expanded rapidly across Bangladesh, as in other developing nations. GrameenPhone, largest of the nation’s six cellular providers, has more than 13 million subscribers, with yearly revenues of nearly $700 million. In all, perhaps one in seven Bangladeshis owns a phone, and ownership is expected to reach as high as one in three in a year or so.
Ten years ago, Begum provided the sole telephone in Patira and the surrounding area, the only connection for nearly 10,000 people. Today, she must vie with 284 other Village Phone operators nearby, plus all the cell phones her neighbors have bought for themselves as prices have come down.
As a result, Begum’s phone rentals these days bring in monthly profits of only $22. “If I didn’t have so many other businesses,” she told me, “I couldn’t afford to be in this one.” Says her loan officer, Salim Khan, general manager of a Grameen Bank branch: “She is fortunate that she began when she did. Today, poor women who go into the phone business stay poor.” Read more.
3 Comments
harsha de silva
i interviewed prof yunus yesterday for our biz1st in focus show on mtv sri lanka to be airred on friday 24 august. and this issue was discussed at length. he was under no illusion that the importance of the village phone ladies was diminishing as the article points out and for the same reasons given therein.
the question is no longer about phone ladies. that story happened in a different era and helped prof yunus win the well deserved nobel. the question now is how will the newfound access to information via mobile phones transfrom the lives of the billions at the bottom of the pyramid in bangladesh and the rest of the world. how will the mobile phone bring money to the pockets of those who have a device? what has to happen in the content arena, what has to happen in the policy and regulatory arena and so on. we at LIRNEasia plan to get in to research in this space in our next cycle; what does it mean to convert the mobile phone from what we use it today to what it will be used for tomorrow as a transaction device.
prof yunus had some very intersting observations about this discussion calling it [mobile plus device] an aladin’s lamp! i will figure out a way to link the show to our site after the 24th.
before i close back to the village phone program. a LIRNEasia study by zainudeen and knight-john in 2005 indicated that there were several [braodly speaking] institutional reasons that helped the program succeed besides micro-credit; these included a massive bulk discount to the the village phone program by the network operator grameen phone, without which success at replicability was not guaranateed.
chanuka
If the Village Phone model is obsolete in Bangladesh because more Bangladeshis can now afford their own phones, let it be. The project had served its purpose in Bangladesh and now the time is may be to discontinue.
In development, there is nothing like ‘free sizes’. The projects should be designed according to the requirements of the environment. Timing too is an important factor. It is not a surprise a model designed few years back is no more relevant. It is not the fault of the model. Just we need a different solution.
I am sure, there are so many other places in the world where Village phone model would still be a success.
samarajiva
Good story: http://groups.yahoo.com/group/bangla_ict/message/5032
Rebuilding telecom infrastructure after disaster: Resilience or building back better?
In an article published on 31 December 2025 in the Daily FT, LIRNEasia Chair Professor Rohan Samarajiva highlights how the Ditwah disaster exposed major vulnerabilities in telecom networks. He emphasizes that numerous telecom sites across the country were affected, leaving many districts without mobile or data services for days, which restricted access and delayed restoration efforts.
Artificial Intelligence (AI) governance is a concern Sri Lanka must address now
LIRNEasia Data, Algorithms, and Policy (DAP) Team Lead and Research Manager Merl Chandana was featured in ‘The Morning’ newspaper on 28 December 2025, in an article by Nelie Munasinghe, where he underscored the urgency of moving from AI policy discussions to real-world implementation. “The perception that Sri Lanka has not yet widely adopted AI is inaccurate.
Gayani Hurulle at UNESCAP workshop on Cross-Border Data Sharing for Digital Public Service Innovation
Gayani Hurulle (Senior Research Manager, LIRNEasia) was invited to conduct a session on the current state and challenges associated with cross-border data sharing at a regional capacity-building workshop on ‘Cross-Border Data Sharing for Digital Public Service Innovation’. This workshop, organized by the United Nations Economic and Social Commission for Asia and the Pacific (UNESCAP) in collaboration with the Ministry of Science and ICT (MSIT), Republic of Korea, was held on 18 December 2025 in Seoul, Republic of Korea.
Links
User Login
Themes
Social
Twitter
Facebook
RSS Feed
Contact
9A 1/1, Balcombe Place
Colombo 08
Sri Lanka
+94 (0)11 267 1160
+94 (0)11 267 5212
info [at] lirneasia [dot] net
Copyright © 2026 LIRNEasia
a regional ICT policy and regulation think tank active across the Asia Pacific