Graduation into Sustainable Livelihoods

CGAP is part of a global community of people interested in and implementing Graduation programs aimed at moving people out of extreme poverty and into sustainable livelihoods. To share and find additional resources and publications on the the Graduation Approach, please visit the Microfinance Gateway

In early 2013, the World Bank set its twin goals of eradicating extreme poverty and promoting shared prosperity by 2030. According to World Bank data, nearly 1.2 billion people are still living below the extreme poverty line with an income of US$1.25 or less a day. The poorest are a very separate segment from the “not so poor”—with many disparities between these two groups. Context is crucial, but there are some overall characteristics of extreme poverty. Food insecurity, unreliable incomes, and a lack of assets and land ownership are shared features of extreme poverty. Beyond “measurable” household characteristics, family dynamics with high dependent/earner ratios, poor access to social networks, and lack of self-confidence tend to mark the difference between the extreme poor and those somewhat better off.

With a few notable exceptions, both microfinance and livelihoods programs typically do not reach the extreme poor. Interventions that do manage to make this oft-invisible population visible, however, can have lasting impact.

One such program was pioneered by BRAC in Bangladesh. Their “Challenging the Frontiers of Poverty Reduction-Targeting the Ultra Poor” program proved to help families move, or “graduate,” from extreme poverty into food security and sustainable livelihoods. Its success prompted CGAP to study and write extensively about the approach and how it might be adopted in other parts of the world.


Photo Credit: Michael Rizzo

To gauge the universality of the BRAC model, CGAP and the Ford Foundation launched a partnership in 2006, testing and adapting the approach through 10 pilot programs in eight different countries: Ethiopia, Ghana, Haiti, Honduras, India, Pakistan, Peru and Yemen. We were intrigued by the idea that with the right mix of interventions, offered in the right sequence, the extreme poor could “graduate” from extreme poverty into a sustainable livelihood within a defined time period. The CGAP-Ford Foundation Graduation Program begins with consumption support, mindful that part of what it means to be extremely poor is that the person is so overwhelmed by survival-level issues such as food security that she cannot meaningfully tackle any longer- term livelihood strategies. Once those basic needs have been met, participants receive support in saving money (a vital tool in managing risks), technical skills training, asset transfers (generally in-kind assets such as livestock), and intensive life skills coaching. All Graduation Program pilots have a robust learning and evaluation agenda with qualitative research. It includes a “life histories” approach and ethnographic methods, which offer a more granular understanding of the process of change in pilot participants’ lives and behaviors, as well as randomized controlled evaluations.

Beyond Graduation
The Graduation Program recognizes that financial services have a role in participants’ trajectories beyond graduation. Continuing to save after the end of the program can help participants protect assets and accumulate money for future investments or emergencies. A shared goal across the pilots is that by the end of the program, members have access to a wide range of financial services. The Graduation Approach is not a short-term escape from extreme poverty but instead seeks to equip participants with the tools, livelihoods, and self-confidence to sustain themselves when the program is over.

The CGAP-Ford Foundation Graduation Program is committed to sharing lessons on implementation and results of research through an active community of practice of practitioners, policymakers, funders, and researchers dedicated to dramatically scaling up solutions that help end extreme poverty. In September 2014, findings and lessons learned from the graduation pilots were published in From Extreme Poverty to Sustainable Livelihoods: A Technical Guide to the Graduation Approach. This Technical Guide serves as a know-how manual to practioners, researchers and others interested in implementing well-documented and successful graduation scale ups.

Going forward, through the Graduation Program, CGAP and its partners will be exploring how to integrate the Graduation Approach into the social protection programs of governments and larger funders using synthesized research findings along with lessons from the first wave of graduation pilots.

Resources

Contact: [email protected]

Publications

12 December 2016
Continued reduction of extreme poverty will require targeted interventions to help the poorest increase their standard of living. Effective social protection programs are critical to this effort. Livelihood development programs, lump-sum cash transfers, and graduation programs have the potential to help the very poor increase incomes to move out of extreme poverty.
Download PDF: 
English (24 pages)
12 December 2016
The graduation approach is expected to grow in scale and influence, with strong demand from governments to create nationally scaled programs. Governments and other implementers are showing keen interest in innovations to (1) adapt the approach to additional vulnerable segments, such as refugees, extreme poor urban households, or disadvantaged youth; (2) expand the range of income-earning options beyond rural livelihoods; and (3) improve cost-effectiveness through measures such as digitization of transfers and financial services or group-based delivery of coaching and social support.
Download PDF: 
English (4 pages) | Spanish (4 pages)

From Our Blog

Family reading outdoors, Paraguay
20 December 2016
In Paraguay, a partnership between Fundación Capital and the government of Paraguay offers a compelling example of how the Graduation Approach can be integrated into public policy to halt extreme poverty.
Woman takes cash from an ATM
19 December 2016
As Graduation Approaches have spread and scaled, so too have the discussions of the best approaches. Fundación Capital believes that programs should focus on in-cash rather than in-kind asset transfers. Why? Read more about the case for cash.