Helping the ultra-poor out of poverty

Just a year and half back, Tonu Kabiraj (40) and her husband were struggling with their family of five to make ends meet. Their three daughters were all students, and Tonu really wanted them to continue with their studies.

But with her husband's irregular, meagre income as a day labourer and despite her efforts in catching crabs from the nearby Poshur River and occasional involvement as domestic help, it was hard to carry on with their plans.

Last year, they started a seed business. Her husband would purchase seeds from Khulna, and they would sell it to local farmers of Gazikhali in Rampal, Bagerhat, where they live. Her husband also bought a bicycle with which he takes packets of seeds to weekly markets in different villages.

The eldest girl, whom they earlier thought of marrying off, now studies nursing, hoping to get employed soon. The business brought solvency to the family, freeing them from making decisions they would not normally make.

The redemption of the family from the curse of extreme poverty came with the help and guidance of BRAC, the non-government development organisation. 

When Arati Roy got selected for the UPG programme through a participatory consultation with the villagers, BRAC provided her with three goats, 10 ducks and training. Now, she has five goats after selling two. She also sells eggs and ducks on a regular basis. Arati also bought, with her own income, nets for a nursery that she has created.

Under the Ultra-Poor Graduation (UPG) programme, local officials reached out to the family, offered financial help and asked them to pick a business they thought would be perfect for them.

The organisation then closely monitored the business, provided guidance and advice whenever the family needed it. In a nutshell, the organisation invested time, money and manpower to make the small business a success.

Others in the area chose various other options for themselves.

Arati Roy, a woman in her 50s who lives in Gazikhali, chose to expand her farming activity, for example. The unmarried woman who lives with her 70-year-old brother, used to earn very little helping local families with their domestic work.

When she got selected for the programme through a participatory consultation with the villagers, BRAC provided her with three goats, 10 ducks and training. 

Now, she has five goats after selling two; she also sells eggs and ducks on a regular basis. She also bought, with her own income, nets for a nursery that she has created. 

More interestingly, she does organic farming. Two ripe, yellowish cucumbers hanging from the trellis bore testament to it, which she kept for seeds. She said she also used organic fertilisers instead of chemical ones.

She now grows all her vegetables. "I only need to buy rice and edible oil," Arati said.

Both Arati and Tonu kept their businesses expanding. Both of them acquired fish ponds (called gher locally) with credit from BRAC. Meeting the needs of the family, they also sell fish in the local market. They farm mostly freshwater fish and some shrimp.

"I have repaid Tk7,500 from the Tk19,000 loan," said Arati.

"Now I'm doing well, unlike earlier, when bringing food to the table was hard for me," she said.

Apart from the seed business, Tonu also bought ducks and received modern farming tips from the organisation, which enabled her to earn more from the tiny land she has. After graduating from the programme, she took a 50,000 credit from BRAC to advance her economic activities.

Not a simple task

Thirty five million out of 170 million people in Bangladesh still live below the poverty line, although the country has been alleviating poverty at a steady pace. 

People living in poverty are hardworking, but various natural and economic shocks hit the extreme poor the hardest, often delaying their graduation from poverty. 

Extreme poverty interventions can be likened to raindrops in a desert. The droplets take no time to disappear, and the desert quickly dries up as before. 

In microcredit programmes, it is common for people living in extreme poverty to use the credit in unintended, unproductive sectors, or for emergencies, often requiring them to take loans from other organisations to repay the earlier loan. Of course, there is no shortage of success stories in microcredit programmes.

UPG is carefully designed to ensure that this does not happen. The intervention even provides contingency funds so if a beneficiary needs treatment or a family member dies, the fund is used in handling the situation, not requiring to be repaid.

Also, none of the UPG finances have interests tied to them. Conditions tied to the credits also vary according to the status of the beneficiary, which is determined during onboarding onto the programme. 

For group one, which Arati belonged to, the inputs given are totally free, not requiring the beneficiary to repay. Others payback as they graduate.

The main challenge is to prevent the members from selling out their assets faced with acute financial needs. Close monitoring and guidance is the key, said Tomgidul Islam, the zonal manager of UPG programme in Khulna. 

The programme activities also include connecting members to various government services and training so they can avail the benefits of the government projects aimed at helping the poor.

BRAC has been implementing the UPG programme since 2002. The organisation supports 70,000 ultra-poor families each year, with a success rate of 95%, according to Upoma Mahbub, senior manager of the programme. So far, 23 lakh families from 48 districts have graduated from ultra-poverty with the help of the programme, the official said.

Implementing the programme for urban poor, especially the climate migrants, is particularly challenging, the senior manager said.

"Although the principles are the same, the activities in the programme vary a lot depending on the community they are designed for. For instance, urban interventions are different from rural interventions. Interventions for indigenous communities and people with disabilities are also different, based on their special needs," said Upoma Mahbub. 

It is crucial for poverty alleviation projects to closely observe the changing ground realities and unexpected shocks such as natural calamities, climate change impacts, or pandemic that hit the respective areas, she said. A successful programme would quickly adapt to the abrupt changes, she mentioned.

The rapid, unplanned urbanisation also poses a significant challenge, she said, adding that the programme is continuously going through a learning process when designing interventions targeting urban poor.