BISP Graduation Model

BISP Graduation Model (BGM)

• BISP Graduation Model (BGM) has been designed to enable the cash grants recipients to eventually transform into income earning individuals through

  • self-employment, or
  • wage employment and stable supply chains, or
  • demand for work through public programs.

• It would

  • enable the cash grants recipients to eventually transform into income earning individuals through self-employment and/or wage employment,
  • protect the large numbers of vulnerable poor to fall again below BISP cash transfer threshold (currently 16.17 PMT score) and avoid becoming BISP beneficiaries again.

Graduation Model Background

  • Ending poverty in all forms and dimensions by 2030 is the first Sustainable Development Goal (SDG) which can only be materialized with the implementation of adequate social protection systems and sound policy frameworks, based on pro-poor and gender-sensitive development strategies.
  • Cash transfers (CT) programmes are the main instruments of social protection that not only contribute to poverty reduction but also promote inclusive economic growth.
  • However CT programs have been more successful and sustainable, when they are combined with complementary, well-sequenced interventions on the uptake of education, health and nutrition services, and when there is additional livelihood support for the poor.
  • In this respect, BISP launched the Waeela-Rozgar (WeR) programme in 2012 with an aim to provide work opportunities to select marginalized BISP beneficiaries by providing them vocational training as well as necessary knowledge and skills for enabling them to earn a livelihood and a subsequent integration in the labor market.
  • BISP had also launched Waseela-e-Haq (WeH) scheme in September, 2009 to provide and enhance small business and entrepreneurship among poorest of the poor to come out of poverty trap. An amount of Rs. 2205 Million has been disbursed among 13455 beneficiaries.
  • Based on international best practices and learning from WeR and WeH, BISP initiated the consultation process with its development partners and the provincial departments/ agencies to develop a graduation model for BISP beneficiaries.
  • The purpose of this consultation process was to design an appropriate graduation strategy for its beneficiaries by exploring global best practices and graduation models that offer a low-cost, high impact and sustainable solutions for their possible exit from the poverty trap. The aim of model is to create a model that is sensitive to the local context and specific to characteristics of the BISP beneficiaries.

Graduation Model Objectives

  • Improving or creating income opportunities by developing self-employment and supply chains to the private sector through (a) comprehensive coaching, and (b) inclusive business approaches.
  • Developing the productive asset based through provision of income generating grants and loans, creating employment opportunities through developing their managerial and technical and vocational skills, and creating supply chain and market linkages to companies and other consumers that would buy the products of the poor.

Core Elements and Interventions

• BGM is based on five core elements including;

  • Area Specific; to harvest local potential and reap the benefits of local market;
  • Beneficiary Specific; to accommodate poor and uneducated BISP beneficiaries;
  • Simple in Implementation, to ensure that BISP can implement it using its internal resources;
  • Builds on BISP’s core competencies; that is, takes advantage of its cash payments mechanisms in place;
  • Scalable; to ensure that the largest number of beneficiaries, who have the potential to graduate, are given the opportunity to do so.

• To graduate BISP beneficiaries, BISP designed 2 interventions which will be piloted in first phase and scaled up subsequently:

  • Business incubation and asset transfer for self employment among the poor (the BISE model).
  • Direct Cash for start up business with some business coaching (DC model).

BISE Model

Business incubation and asset transfer for self employment among the poor (the BISE model)

  • This component aims at making poor people ready for taking up viable self-employed. A total of 100,000 households will be targeted. The beneficiary must be competent to do self-employment and show her/his willingness to be part of the graduation program.
  • A Micro Investment Plan (MIP) for each selected household will be prepared to determine which type of investment is most appropriate for graduation. Investment may be in the form of one or multiple interventions as identified in the MIP.
  • The program will be implemented for BISP by NRSP. The key features of this component comprise:
  • Profiling targeted households on their potential for self-employment.
  • Agreeing with the BISP beneficiary that UCT will continue for only 1-2 years to provide protection against risks.
  • Giving specific technical skill trainings and business development support to selected programme
  • Transfer of assets to start economic activities;
  • Providing income generating grants (working capital) to help the poor set up their business.
    The working capital grants are endorsed with a mandatory 2 year saving scheme and with enrolling for 2 years in health insurance (or other relevant scheme insuring the business against risk such as fire, steeling, etc)
  • Support services through linkages to existing microfinance programs (for inputs), and markets and value chains (for sales).
  • It is expected that at least 60% of the BI-SE beneficiaries will also graduate out of the UCT payment. To this end, assessments will be done by BISP (tehsil offices) on a yearly basis and adjustments in the UCT status will be done accordingly.

Introduce the Inclusive Business (IB) development component for income generation through linking up the poor to the value chains of at least 3 larger companies (such as such as Engro, Nestle, Metro, and
others). To escape poverty, the poor involved in Inclusive Business investments of such companies would
get income higher than the market rate from those companies, along with other support services from these
companies i.e. training, inputs and secure markets. The special IB agreements with the companies will
determine whether the companies (preferred) or the poor directly will receive funding for the development
of the value chains.

  • Progress Figures
Districts Bahawalpur, Charsadda, Jacobabad, Kech, Nasirabad
Target group 100,000
Net Budget US$ 35 million
Implementing partner NRSP

DC-SU Model

  • The direct cash with business coaching for start-ups (the DC-SU) component is based on the premise that
    poor people can make economically rational investment decisions if they are provided some small and initial help with business development. Beneficiaries interested in this program will be asked to trade the monthly CT payments they are entitled to, in exchange for receiving a one-time lump-sum payment.

The activities for implementing this program are as following:

  • BISP will pilot this approach by visiting 60,000 beneficiaries and informing them of the new lump-sum
    graduation program. It is expected that approximately 15,000 beneficiaries will apply and be suitable to
    take up the DC-SU graduation program. The beneficiary selection will be done by BISP Tehsil offices.
    From amongst the participating beneficiaries, approximately half will receive a graduation offer; this will mainly depend on the readiness of the business. The selection is based on the readiness of the small
    business to achieve sufficient income to graduate out of poverty. Detailed selection criteria were prepared and need to be further fine tuned and then endorsed by BISP management. This system also allows having control groups to measure the impact of the program.
  • The amounts of cash grants received will differ depending on the option the BISP beneficiary will chose to graduate out of poverty. She/he will receive either a) PKR 70,000 for voluntarily agreeing to give up UCT for 4 years; or (b) receive PKR 54,000 for voluntarily agreeing to give up UCT for 3 or 4 years, and signing the agreement.
  • As such forms of self-employment are more viable in urban areas, the DC-SU implementation is targeted to urban and semi-urban areas.
  • Participants will be asked to provide business plans which will be the basis for determining the readiness of the investment. To help with the proper business plan, BISP Tehsil office through business experts will provide business coaching. Beneficiaries will receive – if needed – selected, targeted and on the spot (in the field) business development coaching from experts.
  • The implementation progress will be assessed through monitoring visits by BISP’s tehsil officials, and in selected cases also by the business school. The implementation of this program will be closely monitored by the MIT/Harvard/LSE team, and the research and evaluation and implementation costs will be funded by the Gates Foundation and BISP will only pay UCT in advance.
  • After the completion of the designated suspension time (3-4 years), and in case the business is not
    successful due to external risks (e.g. natural disasters or major unforeseen urgent family expenses for health), or other relevant changing conditions outside of the business, the beneficiaries will be eligible to re-apply into BISP by undergoing a new survey similar to the NSER that can be completed at the tehsil If they are found to be under the PMT cut-off as assessed by the survey, which may be subjected to an independent check to be determined later, they will be eligible to re-enrol into BISP.
  • Progress Figures
Districts Faisalabad, Chakwal, Laki Marwat
Target group 3,000
Net Budget 5 million US$
Implementation BISP in collaboration with MIT/Harvard/LSE


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Implementation Status

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