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How to Help the Poorest of the Poor

Rishi Malhotra June 30, 2010

While microfinance has been a great success, it is not necessarily the best thing to offer to the poorest of the poor who live on under $1 a day. Characteristics of this group include having an irregular income usually from begging or manual labor, children working in manual labor instead of going to school, severe malnutrition, physical handicaps, usually landless, and are incredibly vulnerable to natural disasters or other catastrophes.
Microcredit will not work too well as a first step in ending their poverty because they have such inconsistent incomes that the debt incurred from this may just make them even worse off. The other parts of their life such as stable access to food and basic heatlh need to be ensured before microcredit can be considered.
A few organizations do end up doing this. SKS, Bandhan, and BRAC are among the most widely known. BRAC’s program for targeting this population is incredibly successful and the percent of households living under a dollar a day dropped by 20% and the percent of families that went without food for certain days dropped from 60% to 15%. The cost of this is high and some smaller organizations would not be able to afford this so alternatives models for targeting this population are being developed by various organizations.
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Photo Credit: Swayam Krishi Sangam
Sustainable Development

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