Helping the Poorest Access Resources, Training, Financial Services

Luckshmi Sivalingam, Program Officer for Grameen Foundation’s Solutions for the Poorest program, oversees the Livelihood Pathways for the Poorest (LPP) project in India. One week last August, after slogging barefoot through a kilometer of muddy fields and monsoon rains, my colleagues from The Livelihood School at BASIX India and I reached our first ASHG (adapted self-help group) meeting of the week. We were greeted with warm smiles from the female members of one of the strongest ASHGs developed through the Livelihood Pathways for the Poorest (LPP) project in Bihar, India, to date. Trust levels and self-confidence are slowly building, as are savings habits among our members. Our project has two main goals: identifying and building a diverse and stable group of livelihood activities that will generate increased income throughout the year, and providing immediate and long-term socio-economic support for the group members and their families. We have been working with the local government since May to link poor households to various support programs, including child and women's healthcare and work for unskilled laborers. (The 2005 Mahatma Gandhi Rural Employment Guarantee Act guarantees 100 days of wage labor for adults in rural communities who are willing to do unskilled manual work or the equivalent in wages.)  Though the households in our project were eligible to receive these government programs, they either didn’t have the required proof of identification (India is one year into a national ID campaign that many hope will alleviate this problem) or were not aware of them. With our help, they now appreciate the immediate, tangible benefits of engaging in the government programs, as they begin to gradually access and experience the much-needed services that are rightfully theirs. Since we began our discussions with the local government, our target villages have been assessed to see which eligible households lack job cards; the ones that do are currently being processed. In addition, the households will each receive one to two fruit saplings for planting next month.

Understanding our clients’ thinking and the conditioning caused by a lifetime of chronic poverty is one of the most challenging aspects of this work. Our ready access in the developed world to the conveniences of modern life can limit our ability as practitioners to relate to and understand the very different reality of the poor we are seeking to help – a reality that can be a painful one. Living and interacting with them provides us with a window into the challenges of their daily lives, and shapes our own understanding of their needs and the context in which they live. It also helps us to understand the rationale behind the difficult daily decisions they must make – how to feed themselves and their families, what they must forego for the survival of their children and what sacrifices must be borne by the entire household, regardless of age. Designing a methodology, products and services to create “livelihood pathways for the poorest” will be a process of testing and retesting these next two years.  

One such client is Sunita Devi, a 35-year old widow with two children in the village of Pali. She is the only breadwinner in her household, with an annual income of 21,600 rupees (about 40 cents per person per day). Though Sunita’s ASHG is thus far one of the weakest ones, we hope – through continued household visits, engagement with male members of the village (an important element in these patriarchal households) and concentrated mentoring services – that her group will gradually catch up with the more advanced groups. As a widow and a head of household of a family living below India’s poverty line, she is eligible to receive cash and other transfers that she was not able to access on her own. We are working with her ASHG to help members begin to save every month, so that in times of urgent need, she will appreciate how savings can become a risk-management tool. More advanced groups have been given a savings box, which is typically held by the treasurer. The members purchase locks and two sets of keys, which are usually held by the president and secretary of the group. This balance of power allows no single person access to the group savings. In September, we also trained Sunita and her peers in kitchen gardening practices and agarbatti (incense stick) rolling. We expect that these two supplementary income-generating activities, combined with government programs, will provide immediate relief for Sunita and her children, from both a financial and food-security standpoint. Once our households have stabilized and ASHGs are further strengthened, we will begin training and introducing them to more high-skilled activities that generate stable yearly income. We hope this gradual transition will lend to a more effective and committed uptake of entrepreneurial activities – and a very different approach to life itself. To ensure this, we will focus on providing appropriate financing options for their new livelihood activities, such as microcredit and microinsurance. Our next challenge will be customizing these programs in a way that doesn’t add to the indebtedness and daily strains already facing such a poor population. We have also been holding stimulating discussions with BASIX staff about designing appropriate financial products, while considering the final design of livelihood-development services. Important questions we've been pondering and answering include: How should the introduction of supplemental income-generating and entrepreneurial activities be sequenced? Which elements of shariyat (Islamic) banking can be applied to vulnerable and poor populations? How can repayment be structured to sync with projected income cycles? What aspects of traditional systems can be embedded in the product design that will promote greater understanding and acceptance of the financial products by our households? The answers to these questions are shaping some very innovative, finely blended products that we're looking forward to testing over the next year.