This commitment will implement a new pilot in sub-Saharan Africa and scale-up other successful ultra-poor pilots. Additionally, CGAP will continue conducting quantitative and qualitative research to track changes in peoples' lives and adjust programs so they are even more effective.
The commitment will include three main elements.
1. CGAP will select implementing organizations to launch an additional pilot in sub-Saharan Africa. The project will start with a review of poverty levels, livelihood opportunities and potential market linkages for extremely poor people in the chosen area. Based on these efforts, a menu of 'livelihood options' for beneficiaries will be selected, and the package of food aid and livelihoods interventions will be determined. Implementing organizations will receive technical assistance to learn how to design, sequence and coordinate services. A randomized impact assessment and qualitative research will be conducted for the new pilot.
2. In addition to their other planned commitments, CGAP will help the partners on this commitment raise million from bilateral and national funders to expand successful programs to a larger scale. Proving the efficiency of the model in a scale-up phase should lead to replication of the programs by long-term funding partners on regional- or national scales.
3. Several pilot projects are being accompanied by rigorous impact assessments using randomized control trials to determine causality between program participation and changes in the economic and social conditions of clients. Qualitative research is also underway in several pilots. Lessons from both the quantitative and qualitative research will be incorporated in the design of the scale-ups. They will also be shared with donors, policy-makers and the wider development community. These advocacy efforts will showcase this model as a new viable pathway for a large proportion of the poorest to graduate out of chronic poverty.
Microcredit is an excellent tool for poor people with the stability and skills to operate a microenterprise. However, people at the very bottom of the economic ladder are often excluded from microfinance. In the best case, they are served by safety net programs, which usually take the form of cash transfers, food aid, or guaranteed employment schemes.
CGAP and the Ford Foundation,with support form the MasterCard Foundation and BRAC, have partnered to explore how a careful sequencing of safety nets, asset transfers, livelihood training, and financial services can create pathways for the poorest out of extreme poverty. Pilots combine the targeting and transfer elements of safety net programs, and introduce entrepreneurial activity through training, an asset grant, and access to credit.
The model adapts a methodology developed by BRAC in Bangladesh over ten years. Since 2004, BRAC's Targeting the Ultra Poor Program has ushered 800,000 households out of safety-net programs to become successful microentrepreneurs. While their businesses are small, moving poor people from dependence on hand-outs to becoming independent earners is a gigantic leap in development terms.
Following a 2005 CGI commitment, nine pilots have been set-up in India, Haiti, Pakistan, Honduras, Peru, Ethiopia and Yemen. Quantitative and qualitative research is being conducted on a global scale with exceptional rigor. The model is proving high potential for alleviating extreme poverty in different contexts and this commitment will add to the model.