CGAP Announces New Platform for Graduation Approach

CGAP Announces New Platform for the Graduation Approach to Help Transition People from Extreme Poverty

WASHINGTON, D.C., October 16, 2017 – The Consultative Group to Assist the Poor (CGAP) has successfully proven through a decade of experimentation that the Graduating the Poor Initiative is one of the most effective means of helping the poorest families transition out of extreme poverty. With this accomplishment, CGAP is now handing the program over as the foundation for a new platform at the World Bank.

The Partnership for Economic Inclusion (PEI) will be hosted by World Bank’s Jobs Group of the Social Protection and Jobs Global Practice. PEI will work with governments to help them implement and scale up graduation-style programs. It will also encourage and track results of the many innovations that are underway to serve segments such as vulnerable youth and refugees and forcibly displaced people.

The partnership will have independent governance and its leadership will come from the World Bank, CGAP and graduation experts from around the world.

Greta Bull, CEO of CGAP, said the new partnership is an excellent example of how CGAP tests innovative approaches to poverty through financial inclusion and shares the knowledge with others to implement and bring to scale. “Graduation has been transformative for many people. Today, it is being adapted in almost 100 programs in more than 40 countries, with governments implementing around one-third of these programs, particularly through their national social protection systems. There is great potential for this approach to reach other vulnerable groups as well,” said Ms. Bull.

CGAP partnered with the Ford Foundation over the past decade to test the Graduation Approach through 10 pilots in eight countries. In these programs, families received food, seed capital, skills training, access to financial services such as savings, coaching and mentoring over a set period of time averaging around 24 months. Rigorous assessment of the pilots showed that incomes and household consumption rose at all but one site. Findings from India released in 2015 were even more encouraging. After three years, consumption for families in the program was 12 percent higher than those without the interventions, and after seven years, consumption was 25 percent higher, suggesting that a multi-faceted approach toward helping poor households can foster a sustainable transition to more secure livelihoods and an exit from extreme poverty. It also showed that beneficiaries spent more time working, went hungry on fewer days and experienced lower levels of stress and improved physical health. Some sites showed progress on women's empowerment and political engagement.

The Partnership for Economic Inclusion will accelerate adaptation and expansion of the graduation approach and will develop a multi-year support program, including in fragile and conflict-affected areas. PEI will identify innovations to increase the cost-effectiveness, sustainability and impact of graduation programs.

Michal Rutkowski, Senior Director of the Social Protection and Jobs Global Practice at the World Bank, emphasized that economic inclusion programs that increase earning opportunities and connect beneficiaries to markets and value chains are critical to the World Bank’s mission to end poverty. “Governments and development partners are keen to identify cost-effective programs that improve the earnings, productivity, and resilience of the poorest and most vulnerable households and individuals. Making progress on the economic inclusion and jobs agenda is a big priority for the World Bank,” said Mr. Rutkowski.

Kate McKee, who is leading PEI’s transition, said, “We aim to serve governments that are investing in helping ensure economic opportunities and an upward pathway of earnings, asset accumulation and human capital building for even the poorest and most vulnerable people they serve. This partnership will be the new go-to place for evidence and emerging good practices, tools and guidance and data and analytics on targeted economic inclusion initiatives. This next wave of experimentation, including government efforts to scale up graduation and adapt it to new segments and contexts, will yield rich lessons that can inform practical guidance and standards.”

Media Contact

Esther Lee Rosen, CGAP
erosen@worldbank.org
+ 1 (202) 458-0147

Lillian Foo, Social Protection and Jobs Global Practice, World Bank
lfoo@worldbankgroup.org
+1 (202) 458-7726

About CGAP

CGAP is an independent think tank that works to empower poor people to capture opportunities and build resilience through financial services. We test, learn and develop innovative solutions through practical research and active engagement with our partners on building responsible and inclusive financial systems that help move people out of poverty, protect their gains and advance global development goals. Housed at the World Bank, CGAP is supported by over 30 leading development organizations committed to making financial services meet the needs of poor people.

The Jobs Group of the Social Protection and Jobs Global Practice was created to support World Bank Group client countries in the design and implementation of integrated, multi-sector, jobs strategies. These jobs strategies articulate policies and programs that address three main challenges most countries face to varying degrees: (a) creating jobs, particularly in the formal sector of the economy; (b) improving the quality of informal jobs; and (c) improving jobs opportunities for vulnerable population groups such as women, youth and the poor. More at www.worldbank.org/jobsanddevelopment.