Income-Generating Activities - Action Against Hunger

More documents

Recommendations

Info

Field handbook • Scientific and Technical Department ble populations. IGAs are also developed around WASH projects to enhance sustainability of water, sanitation and hygiene programs and equipments. When defining IGA programs, it is important to decide which funding mechanism is most suited to the level of vulnerability of the target population and to the context: subsidies or donations, partial or total repayment of investment through communitymanaged revolving funds, or micro credit. While donations can be used to fund the activities, continual transfer of money or goods can lead to the creation of dependency. In sufficiently stable contexts and for populations that are not the most vulnerable, funding IGA through microcredit is a more suitable option. ACF doest not encourage the use of credit in all cases but recommends analyzing microcredit as a potential funding mechanism for IGA projects when the context and environment allows it. Recommendation 1: ACF recommends analyzing whenever appropriate microcredit as a potential funding mechanism for IGA projects Looking at IGAs funding mechanisms at the community level, donations may also undermine local structures and systems which traditionally fund IGAs in the community. These systems can be informal (local merchants, informal money lenders) or formal microfinance institutions. Traditional funding mechanisms can be extremely costly for beneficiaries so ACF does not systematically support the reinforcement of these mechanisms. But ACF does recommend always including in the IGA program assessment the identification of local funding mechanisms and the analysis of the impact donations may have on these mechanisms that traditionally fund IGAs in the community. Supporting long-term local financing mechanisms while pushing for a reduction of the cost for beneficiaries also prepare ACF’s exit strategy of the region. Recommendation 2: When designing IGA programs, ACF recommends analyzing the possible negative impact of donations on existing local IGA financing mechanisms However, ACF is not a microfinance organization and does not have in-house microfinance expertise. The 2004 positioning on microcredit stated that ACF should never become a microfinance institution. This positioning has not changed. The main reasons are: • Timeframe: Managing microfinance activities requires a long-term involvement with the community. Given the fact that ACF missions are not set up to stay permanently in a country (rather leave when the situation in the country stabilises) the timeframe to set up microfinance activities is not suitable. INCOME GENERATING ACTIVITIES: A KEY CONCEPT IN SUSTAINABLE FOOD SECURTIY 105
➔ • Financial investment: Setting up a sustainable microfinance institution takes time and requires significant investment before reaching sustainability. As microfinance is not a core activity of ACF this type of investment is not a priority for the organization. • Professionalism: A microfinance institution is a complex organization in terms of operations. Managing the institution in a sustainable manner requires specific inhouse expertise that ACF does not have today. Building this expertise would be long and costly and is not deemed a priority given ACFs mandate. • Legal constraints: Although the situation varies country by country, microfinance activities often have to respect a set of legal constraints (such as minimum capital to set up a microfinance institution and risk-management ratios to respect). It may be necessary to apply for a licence before operating microfinance activities, in particular to offer saving services. In addition international microfinance “Best Practices” recommend that financial services should not be delivered by the same institutions that provide non-financial services (food and cash donations, social programs, skills development, market access etc). Therefore, as in the 2004 positioning paper, ACF does not recommend directly carrying out microfinance activities. Recommendation 3: ACF should never become a formal microfinance institution or register as a banking institution; ACF should not create microfinance subsidiaries; ACF should not directly manage microfinance funds When deemed suitable, in order to provide beneficiaries with microcredit to fund IGAs, while not taking on the burden of managing microfinance activities directly, the way to explore is to develop partnerships with local microfinance institutions. The objective of a partnership with a microfinance institution is to widen the options to fund IGAs while at the same type avoiding managing complex financial projects which are not part of ACF’s core expertise. Working with MFIs has several benefits: • Working with an established organization ➔ no need to set up a new organization or structure • Working with an organization specialized in financial services ➔ added value from a specialized partner • Working with a sustainable organization in the region ➔ easier for ACF to have an exit strategy as long-term presence is ensured by the partner 106 INCOME GENERATING ACTIVITIES: A KEY CONCEPT IN SUSTAINABLE FOOD SECURTIY
Page 1 and 2:
Field handbook • Scientific and T
Page 3 and 4:
Edit: Action Against Hunger - ACF I
Page 5 and 6:
➔ Pages CHAPTER 4: INCOME GENERAT
Page 7 and 8:
➔ questions that can give the rea
Page 9 and 10:
➔ Chapter 4 focuses on programme
Page 11 and 12:
➔ Populations that are facing chr
Page 13 and 14:
➔ This diagram attempts to visual
Page 15 and 16:
➔ - Recuperation and improvement
Page 17 and 18:
➔ Example 3: Creation of IGA in t
Page 19 and 20:
➔ of this first chapter, the recu
Page 22 and 23:
CHAPTER 2: ANALYSIS OF THE CONTEXT,
Page 24 and 25:
Page 26 and 27:
Page 28 and 29:
Page 30 and 31:
Page 32 and 33:
Page 34 and 35:
Page 36 and 37:
CHAPTER 3: TYPES OF PROGRAMMES AND
Page 38 and 39:
Page 40 and 41:
Page 42 and 43:
Page 44 and 45:
Page 46 and 47:
Page 48 and 49:
Page 50 and 51:
CHAPTER 4: INCOME GENERATION PROGRA
Page 52 and 53:
Page 54 and 55:
Page 56 and 57: Field handbook • Scientific and T
Page 66: Field handbook • Scientific and T
Page 69 and 70: ➔ During the monitoring phase, at
Page 71 and 72: ➔ — Debts incurred — Access t
Page 73 and 74: ➔ but proper methodology and soft
Page 75 and 76: ➔ ings are good indicators of imp
Page 77 and 78: ➔ Incomes and expenses of the IGA
Page 79 and 80: ➔ • The success of the experien
Page 82 and 83: CHAPTER 6: LESSONS LEARNED Some of
Page 84 and 85: CHAPTER 7: FREQUENTLY ASKED QUESTIO
Page 88 and 89: LIST OF FIGURES Pages Figure 1: Liv
Page 156 and 157:
Page 158 and 159:
Page 160 and 161:
Page 162 and 163:
Page 164 and 165:
Page 166 and 167:
Page 168 and 169:
Page 170 and 171:
Page 172 and 173:
Page 174 and 175:
Page 176 and 177:
Page 178 and 179:
Page 180 and 181:
Page 182 and 183:
Page 184 and 185:
Page 186 and 187:
Page 188 and 189:
Activities A1. 1. Assessment of pot
Page 190 and 191:
Page 192 and 193:
Page 194 and 195:
Page 196 and 197:
Page 198 and 199:
Page 200 and 201:
Page 202 and 203:
Page 204 and 205:
Page 206 and 207:
Page 208 and 209:
Page 210 and 211:
Page 212 and 213:
Page 214 and 215:
Page 216 and 217:
Page 218 and 219:
Page 220 and 221:
Page 222 and 223:
Page 224 and 225:
Page 226 and 227:
Page 228 and 229:
Page 230 and 231:
Page 232 and 233:
Page 234 and 235:
Page 236 and 237:
Page 238:
show all

Income-Generating Activities - Action Against Hunger

Create successful ePaper yourself

Delete template?

Save as template?