The Graduation Approach Works: Now how do we Reach Scale?

Over half of 40 new Graduation projects are being implemented by governments, reflecting the growing interest for this carefully-sequenced multi-sector Approach as an integral part of their national social protection strategies.

However, implementing the Graduation Approach at scale is challenging, with the coaching element forming an especially pronounced hurdle. It is difficult to widely source and prepare staff to coach participants throughout the program. Governments are addressing this in different ways:

• In Ethiopia, the government is layering the coaching component onto their preexisting social worker infrastructure.
• In Burundi and Rwanda, CONCERN is testing less frequent coaching (it was weekly, during the pilot phase).
• The government of Colombia and others are exploring the use of technology with videotaped coaching sessions delivered via tablets or coaching text messages sent on participants’ mobile phones.
• The Peruvian government’s Haku Wiňay is not implementing the coaching component at all since they do not have the capacity to do so effectively—they are promoting the use of community resource people for technical assistance instead.

Despite the trend of finding alternatives to the coaching element of the program to save costs and scale faster, other programs are making adjustments in other areas. Outside of Peru, the vast majority of new projects follow the full Graduation package.

To achieve efficiency gains and cost savings, many programs are also providing digital cash transfers rather than in-kind consumption and assets. Of course, providing cash instead of in-kind assets carries the risk that transfers will be used for purposes other than those intended: the project’s capacity to implement and monitor the use of cash is therefore important. But this practice also has many advantages.

• Participants often prefer cash to in-kind support because it allows them to choose how and when to spend the funds, such as which food or livestock to purchase at a particular time of year.
• Cash transfers significantly ease the logistical demands on project implementers and remove the burden of sourcing and distribute physical goods.
• Cash-based transfers present the opportunity to work with households on financial literacy as they consider how best to manage that cash—be it given to the participant directly or deposited electronically into their accounts
• Digital transfers are being tested in 12 new projects and hold strong potential to make delivery more convenient for recipients, while reducing the costs for project implementers. Digitized transfers may become an entry point into the wider world of formal financial services, such as savings, insurance, and credit.

In a number of countries, government commitment to scaling up Graduation is coinciding with national initiatives to increase the availability and use of digital and non-digital financial services: a well implemented, digitized Graduation project may become the first step toward financial inclusion for the hardest-to-reach segment of the population in some countries.

We do not yet know how effective new programs will be as they adapt the Graduation Approach to their own purposes and constraints; the encouraging long-term impact results of the Graduation Approach were generated from implementation of to the full set of interventions.

Moving forward, CGAP sees the need to focus more attention on exploring:

• How can access to quality financial services promote income-earning opportunities for the very poor and most vulnerable segments such as refugees, youth, and smallholder farmers, leading them to be meaningful financial inclusion?
• How can digitization of transfers (and other financial services) work better for these segments and for the governments and financial service providers involved?

Answering these two questions will be critical to the graduation and financial inclusion communities of practice, and all those seeking to reach the Sustainable Development Goals by 2030.