Reaching the Poorest: Lessons from the Graduation Model

Microfinance is about extending financial access to poor and excluded people. However, apart from a few notable exceptions, microfinance has not typically reached extremely poor people—those at the lowest level of the economic ladder. Some practitioners, governments, and funders, however, are specifically interested in reaching extremely poor people. Whether seeking to foster social protection or financial inclusion, many wish to understand how best to put them on the path toward sustainable livelihoods—a path that increases incomes, expands assets, and provides food security so that the poorest no longer require support from safety nets and can make good use of credit, if they want to.

This paper highlights the lessons learned from the Graduation Program first by describing how the model works and how various partner organizations implement it in the field. A subsequent section distills the early findings and is followed by a section on costs. The final section takes stock of the learning to date, including key constraints and outstanding questions.