Boosting women's incomes not only benefits them, but often also raises the nutritional and educational status of their families. This article compares two approaches to raising women's incomes: the employment approach, whereby women are employed in a production unit owned and run by an NGO, and the empowerment approach, which involves forming village groups and developing self-confidence, and enabling women to increase their incomes through collective action and group savings. Whereas larger increases in income can sometimes be generated by the employment approach, this article suggests that the empowerment approach is less dependent on outside funds, and creates a sense of self-confidence in the women involved.
Innovations for success and scale-up: an analysis of Bandhan’s Targeting the Hard Core Poor programme in India
Across the world, programmes that reach the ultra-poor have a similar design, with few differences. Based on secondary literature and practical experience, this paper describes the key features, and examines the innovations and adaptations of the scale-up and replications of these programmes. A participatory review of the Targeting the Hard Core Poor programme forms the basis of the discussions, with references to CFPR, CLP, and CAIM programmes. The paper highlights very high success rates of ultra-poor programmes across the world and in India. The critical adaptations in replication include preference to inclusion errors over exclusion errors, confidence building of the ultra-poor women, an expanded choice of enterprises, flexible graduation indicators, and rigorous monitoring systems. Areas of further research include studying the sustainability of village-level institutions for protection of the ultra-poor. The paper cautions that ultra-poor programmes should not replace official social protection schemes, for which continued advocacy is needed.
Crossfire: The ‘Occupy’ movement and the polarization of rich and poor demonstrate that we are losing the battle on poverty alleviation in the free market system
Community-based microfinance: the potential and challenges of self-reliant, self-help group cooperatives
Microfinance services in India are delivered through many channels: self-help and joint liability groups, banks, non-banking financial companies, cooperatives, and post offices. Cooperatives had lost ground but the introduction of new laws allows self-financed cooperatives to operate free of government interference. Using this law, self-help promoting institutions (SHPIs) have federated self-help groups (SHGs) into self-reliant cooperatives. This paper uses a case study of cooperatives in Karnataka State, India, to consider questions about enabling and limiting factors in promoting self-reliant cooperatives. The lessons show that when financial and managerial sustainability is achieved, member-owned institutions give the best financial returns to members from microfinance operations, besides giving decision-making power, and improving the positioning of women-owned organizations vis-à-vis formal financial institutions. Setting up governance and financial systems can, however, be constrained by low incomes and low literacy of members, and attitudes and rules of government and banks.
This special issue focuses on the ways in which microfinance and enterprise development initiatives do and do not help very poor people – that is, their capacity to ‘reach the poorest’.