Grameen Bank's highly successful credit program for the rural poor is known worldwide. Through experience, however, it has come to realize that its long-term developmental objectives require establishing a mechanism to provide high volume risk capital. The Bank has encountered many ideas, technologies and approaches that can lead to business which are economically compelling and socially progressive and do not fall within the scope of Grameen Bank's initial objectives of providing micro credit loan to the very poor. Thus a mechanism became necessary to back the commercially potential but untested businesses and manufacturing concerns yielding benefits for the poor. Grameen Fund was established in 1994 to fill up this risk capital gap for ventures that promises good return on equity investments as well as direct and indirect benefits for the rural poor.

To provide equity finance to the entrepreneurs without capacity to mobilize capital and/or collateral trying to setup innovative projects which holds promise for future growth and have direct or indirect impact on poverty alleviation, with preference to businesses concentrating in information and communication technologies and bio-engineering;
To provide loans, equity or both to risky ventures using untested technology and/or producing untested products, either to new companies or existing companies for balancing, modernization or expansion;
To assist in management buy-ins or buy-outs of existing companies needing finance and management support, provided that activities/products of such companies are socially desirable and bring benefits to the poor; and
To promote or develop enterprises having prospects for export or import substitution that will use indigenous raw materials, provide extensive employment to the rural poor and/or help upgrade the skills of the rural or urban poor.