Targeting the Ultra Poor

This paper reports on the evolution of ultra poor programs. It describes Bangladesh Rural Advancement Committee’s (BRAC’s) Targeting the Ultra Poor (TUP). The paper describes program replications in India and Haiti, and discusses insights from these programs.

The microfinance sector has been exploring an alternative path to reach the poorest through graduation programs that move participants from targeted training and asset-transfer programs into mainstream microfinance. TUP is one such program that allows families that have been dependent on charity to achieve greater self-sufficiency. TUP provides income-generating assets alongside food aid, health services, and skills training. Ultra poor programs:

• Address the self-reinforcing conditions of extreme poverty;
• Hold both promises and risks;
• Have asset transfer as a key feature;
• Can expand the client base of the sponsoring MFI and break the cycle of poverty for the very poorest;
• Must sequence financial products to achieve graduation to microfinance programs;
• Should offer savings products early and in conjunction with safety net assistance.

Early insights from TUP programs indicate that consumption stabilization, close monitoring, and an incremental transfer of knowledge are essential to producing sustainable results.