Draft for comments only Reviewing existing NGO services for the ...

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needs vary widely. Standardized NGO services cannot match the specific and individual needs of the poor; even their loan utilization capacity, which is linked with their initial endowment base, differs significantly among the poor. The present generation of microcredit, commonly practiced by most NGOs, is not beneficial for all the poor because the minimum loan ceiling (fixed by mainly considering the cost side of lending 5 ) exceeds the capacity of the ultra poor to utilize the loan productively. Problems relating to targeting: Success of any intervention depends on the appropriate selection of a target population whose specific needs should clearly match the package of services offered. A wide variety of development literature addresses the failure of government and NGO development programmes in reaching the poorest. Further, studies demonstrate that the success of micro-credit, i.e., the productive and effective use of micro credit, is highly and positively correlated with the initial endowment base of the participants’ households. NGOs, therefore, are reluctant to include the ultra poor in their micro-credit programme in order to minimize the risk of default. Through our survey, we tried to explore the problems faced by NGOs in selecting target groups. As mentioned earlier, in all the surveyed Thanas there was more than one functioning NGO. All of the NGOs target similar groups of people – the poor. The NGOs used similar definitions in identifying the poor and their service package do not vary significantly. Sometimes, several NGOs work in one particular village offer similar kinds of services indicating a high level of competition among NGOs to attract potential customers. Most of the NGO officials reported that NGO membership overlap increases the risk of default and, therefore, all NGOs try to avoid including people with existin NGO membership in their programmes. However, proving multiple membership can be very difficult, most NGO beneficiaries hide their personal identitly while joining (sometimes they mention false names for their fathers or husbands or use father's name in one NGO and husband's name in another). The non-target population is sometimmes included for different reasons. Influence of the village elite and political leaders and neopotism amongst the beneficiaries generally caused this kind of inclusion. Lack of skill and knowledge on targeting methodology among the staff and the absence of clear-cut definition of the target group also increases the risk of mistargeting. 5 The cost of per taka lending is higher for smaller loans and the cost declines as the loan amount increases. The ultra poor, however, do not have the capacity to utilize higher loan amounts and in majority cases they are default loanees who failed to pay back their borrowed amount in due time.
Problems relating to geographical coverage Most of the existing NGOs working in the region are local and their interventions are limited to one particular Thana. There are also big national NGOs that cover wide geographical areas; however, their programme activities for the ultra poor are limited to some selected areas. The recent RED study as well as the WFP povery/vulnerability mapping shows that the extreme poor are residing all over Bangladesh. We tried to understand why NGOs restricted their activities to a particular geographical area. Interestingly, shortage of funds comes first in the response list, followed by problems of NGO membership overlap. The other responses were: 1) higher distance between office and the working area; 2) shortage of manpower for management and supervision; 3) problems in road communication; 4) difficult to expand in low lying areas; and 5) inadequate asset base of the respondents. Only two respondents reported that they concentrated in a particular area because, till the date of the interview, they had not covered the target population within their working area. Problems in linking up with the needs of the poor The NGO officials were asked about problems faced in tailoring their programmes to adjust to the needs of the poor. Most of the NGO officials reported that they could usually link their programmes with the needs of the poor. However, they said that the poor need support on all fronts of poverty 6 and any single NGO intervention can not meet all their diversified needs. The poor are also a heterogeneous group and their needs are different. Any structured NGO intervention without considering this heterogeneity cannot succeed in its interventions. The success of any intervention depends mainly on the active participation of the target population and, therefore, motivation is very important, at least initially. In order to motivate clients, individuals involved in the management and execution of programmes should have a clear understanding of the purposes and objectives of the programme. There are also some extreneous factors that could badly affect the implementation process. For example, natural calamities such as drought and flood, difficulties in road communication, miscommunication, untimely cash flow, and the contractual nature of the project (where the implementing agency can not change the structure) may obstruct timely implementation of the project. Problems relating to sustainability The ultra poor needs continuous support to get out of poverty. According to Sen (1995) the poverty graduation period for an extreme poor is about 23 years with 4% average GDP growth rate. All the ultra poor programmes are subsidized and highly dependent on outside funding. As stated by the respondents, availability of funds and its timely and continuous flow influenced the success of any NGO programme significantly. A significant proportion of the ultra poor are mobile and reside in government khash or privately owned land that they might have to vacate and the landowner's wishes. In this context, cooperation from the community as well as favourable government policy can play a vital role. Respondents also identified selection of wrong people due to lack or use of faulty targeting methodology, lack of or shortage in skilled manpower, political and administrative 6 Poverty is multifaceted. It involves a lack of entitlement to food and “safety nets”, entitlement to assets (such as land), minimum income and employment, investible surplus, access to housing, access to appropriate technology, failure of institutions of the poor, lack of institutional mechanism for savings and credit, human rights and their enforcement, access to health care, access to education, gender equity and a powerlessness to fight exploitation
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