SKS Ultra-Poor Program

Implementers: Swayam Krishi Sangam (SKS)

Pilot Overview

Launched in 2007, SKS reached the poorest in Narayankhed (Medak District, Andhra Pradesh) characterized by high levels of migration, poor wages, and many people too poor to qualify for conventional microfinance.

For more information on this pilot contact: divakar@sksngo.org

Implementing Organization Overview

SKS NGO was established in 1997 as a parent organization to SKS Microfinance Ltd. The NGO was created with the understanding that since commercial microfinance targets a specific segment of the poor to develop and expand their livelihoods; the needs of the poorest are best reached by civil society interventions.

Targeting: SKS targets women-headed households, mostly widows with no male members in the household, under 45 years of age, able to work, owning no productive assets and less than one acre of wet-land or 2.5 acres of dry land, with no on-going loan from a microfinance institution (or Self Help Group loans under INR 2,500 [US$44]). In scale up sites in Orissa SKS targeted men and women headed households.

Consumption support: Instead of ongoing consumption support, SKS provides participants with a cash stipend of INR 1,013 (US$18) maximum, released over an 18-month period on a needs basis. Participants are encouraged to use this stipend primarily to support their asset, for example to buy fodder for livestock. In scale up in Orissa consumption support was INR 1000 (US$20) to participants for 12 months.

Livelihoods: Participants are encouraged to choose an asset based on their existing skills and experience. Livelihoods selected vary from livestock and land cultivation to small trades. The total value of the asset per participant is INR 7500 (US$138). SKS encourages participants to continue to engage in daily wage labor or government sponsored Employment Guarantee Program, with the asset viewed as supplementary income. In scale up in Narayankhed total grant is INR 6000 (US$110), of which INR 3,000 (US$55) is an interest free training loan that is repaid over the course of the program. Note: INR:USD exchange rates as of April 4, 2013.

Financial service: SKS forms Ultra Poor Centers in each location. Group accounts are opened either at post offices or banks. Savings are voluntary but participants are strongly encouraged to save regularly. SKS field staff carries out financial literacy trainings: participants are taught basic numeracy skills, financial planning, and are made aware of formal financial services they may access. In scale up, SKS are providing ‘training loans’, small interest free loans to familiarize participants with repayment cycles.

Additional services: SKS partners with the Indian Government for veterinary support and livestock insurance. SKS fosters the Rice Line Scheme among participants, an informal “rice bank” where each participant can deposit and borrow rice to smoothen food consumption. SKS also provides free health consultations, and carries out “health camps” during which they check participants’ eyesight, iron levels and perform cervical tests. SKS has built a cadre of bare foot medical para-professionals who are provided with medical kit containing (treatment for diarrhea, malaria and other common ailments, nutrition tablets, condoms and oral rehydration salts packets). Participants’ children can access free or subsidized elementary education at SKS Bodhi Schools. In scale up, SKS have introduced “surgery camps” for up to 100 participants.

Research: A mid- term process evaluation and end line process evaluation was conducted by BRAC Development Institute, funded by The MasterCard Foundation. A randomized impact assessment (at the village level) was performed by the Indian School of Business with support from Professor Jonathan Murdoch from the New York University/Financial Access Initiative, funded by the Ford Foundation.

Graduation criteria: SKS considers women to have graduated if their children are in school, households are food secure for at least 30 days, if they have more than two income generating activities including wage labor and if their savings are worth over INR 900 (US$16). Additionally, they must be aware of accessible government programs and have increased knowledge of social and health issues.

Graduation rate: During the pilot phase, ninety-seven percent (426 women) of participants graduated. In the Orissa scale-up ninety- six percent of participants (850 people) graduated. Graduation for the on-going scale-up in Narayankhed is due in October 2013.

Scale up: SKS scaled -up to 1,000 households in Orissa in March 2010 and to 1,400 households in Andhra Pradesh in September 2010 with support from Unitus and the Sorenson Legacy Foundation. SKS Foundation and own resources of NGO are funding the scale up to 307 control group participants in Narayankhed. SKS is actively pursuing funding partners for a pilot in Orissa with tribal ultra poor.