Ultra Poor Graduation Pilot in India
Can an intensive package of support lift the ultra poor out of extreme poverty to a more stable state? This 24-month program provides beneficiaries with a holistic set of services including: livelihood trainings, productive asset transfers, consumption support, savings plans, and healthcare. By investing in this multifaceted approach, the program strives to eliminate the need for long-term safety net services. Spanning seven countries on three continents, the Ultra Poor Graduation program is being piloted around the globe. IPA is conducting randomized evaluations in India, Pakistan, Honduras, Peru, Ethiopia, Yemen, and Ghana to understand the impact of this innovative model.
Governments have often attempted to address the needs of the ultra poor by offering consumption support that is costly and offers no clear pathway out of food insecurity. The Ultra Poor Graduation Pilots attempt to apply a model, developed by BRAC in Bangladesh, which recognizes that the ultra poor need the "breathing space" that is provided by temporary consumption support, but that public funds may be better used to build households’ capacities to maintain a sustainable livelihood. The idea is that this initial assistance, lasting two years, will place households securely on the first rung of the development ladder, which they can then climb with the help of appropriate development strategies. The model incorporates a comprehensive package of services: a productive asset (such as chickens or goats), consumption support, livelihood trainings, healthcare, and financial services.Ideally this wide set of support services will help households to weather any shocks they may face along during their climb out of ultra poverty.
This project is a part of a set of evaluations, in partnership with CGAP and the Ford Foundation, that intends to determine whether the model, pioneered in Bangladesh, is effective in a range of contexts.
Over 30% of West Bengal’s 82 million residents are believed to live below the poverty line, and an estimated 18% of the wealthiest rural citizens actually hold “below poverty line” cards. Murshidabad is one of the poorest districts of West Bengal, and is ranked 15 out of 17 in terms of the Human Development Index. Over 70% of the population of West Bengal lives in rural areas.
Bandhan, a Kolkata-based microfinance institution, was launched in West Bengal in 2002 to address economic and social poverty by providing greater access to formal credit. Due to rapid growth over the past seven years it now has an estimated client base of over 1.2 million borrowers in 12 states in India, providing a variety of products including loans for microenterprises and agriculture.
This evaluation will help determine whether income generating assets indeed prove to be beneficial to ultra poor households, and what kind of asset provision proves most successful. The researchers will assess the impact of Bandhan’s newest venture: an outreach into ultra-poor households based on the provision of assets rather than cash and a holistic set of services. The first step in the process was to determine who was actually in this category. This was done through social mapping and wealth ranking using Participatory Rural Appraisals (PRAs) in each of the target villages.
After a second verification of selected participants, beneficiaries were divided into a comparison and treatment group, of which the randomly selected treatment individuals received a grant of US$100 to purchase a productive asset of their choice. These assets included both farm and non-farm assets, although livestock, such as cows or goats, was the most popular selection. Households were also given access to a fund for health expenditures – a feature that may reduce their vulnerability.
Bandhan will meet with the selected households on a weekly basis for 18 months to check their status and provide supplemental business-skills training. Upon completion of this training, all households will be surveyed to determine program impacts. One year later, a second follow up survey will be conducted to evaluate the long term impacts of the graduation program. Measured outcomes will include income, assets, school attendance of children, health, and food security.
After completion of this evaluation, Bandhan in partnership with Axis Bank is scaling up the program in West Bengal.
For additional information on the Ultra Poor Graduation Pilots, click here.