Small businesses enable rural women to break free from inter-generational cycles of poverty


Samina Samiullah, who belongs to the village of Thatta Kichlarela, near the town of Pindi Bhattian in Punjab, was the poorest of the poor. Until a year ago, Samiullah received a small amount every quarter from the Benazir Income Support Programme (BISP), which came in handy during “leaner periods when there was little to eat”.

But these days her mind is occupied with happy thoughts of preparing jahez (dowry) for her two daughters, both soon to be married.

“I bought blankets and some crockery for them,” she said with pride, adding: “There is still a lot more to be done.” But she is not worried anymore. “It may take me some time, but I know I can manage,” says the kiryana store owner, with an air of confidence.

A government-run social protection programme which started 11 years ago, BISP now has over 5.2 million families on its role, who are paid Rs5,000 per quarter. It ensures a minimum “stable living standard” with the aim to help families break free from inter-generational cycles of poverty, explains Ali Raza Bhutta, Secretary BISP. He says this can be in the form of pure cash transfers or cash with a condition.

“Unconditional cash transfers provide basic income support and conditional cash transfers are to induce positive behavioural changes, like sending children to schools.”

But many question if this can ever pull people out of poverty, especially in these times of rising inflation.

“Obviously, it does not reduce poverty,” says Bhutta, and emphasises: “It is meant to provide basic income support and this income support is critical for families living in extreme poverty.”

From social protection to economic empowerment

Qazi Azmat Isa, chief executive of the Pakistan Poverty Alleviation Fund (PPAF), who has studied social protection programmes very closely, corroborates Bhutta’s views.

“BISP stipend is just for consumption support; it by no mean covers the full expenditure on food that a household makes nor can it be used for economic activity. It is a handout for those fallen on hard times.”

But Samiullah is now among the few of BISP’s beneficiaries who have “graduated” and are being provided livelihood opportunities as well. This was made possible when in 2017 Nestlé-Pakistan began the Rural Women Sales Programme in partnership with BISP through a public-private partnership.

According to Isa, the graduation programme is not just about the cash itself or the asset but the process of economic and social empowerment. He says, “Poverty means lack of access to means/opportunities and resources. Providing an asset is a resource and then providing households with the means with which to successfully utilise that asset so that they can develop productive enterprises is the aim.”

Bhutta says, “Graduation programmes are naturally more expensive than the basic income support programmes because an asset has to be transferred, however, not everyone can be absorbed in the programme. ”

He adds, “It is not fair to leave anyone out, but it is not possible to include everyone either.”

For that reason, BISP has been exploring partnership support with different companies. However, Bhutta says, “no significant corporate partnership has matured other than the one with Nestlé.”

Alleviating poverty through a public-private partnership

Today there are more than 800 women beneficiaries who have been enrolled and trained to become the food and drink processing conglomerate corporation’s rural sales agents across 446 villages in 23 districts of Punjab and Sindh.

While there are no prerequisites to becoming a part of this initiative, Nestlé, however, does look for women who can “do basic math and can write, typically women who have passed the primary level, and those who have the willingness and a belief in themselves to make a difference and change their circumstances,” says Fatima Akhtar, Manager, Public Affairs at Nestlé.

Akhtar says Nestlé wanted to “put these women on the pathway of prosperity whereby, those dependent on a BISP stipend began to successfully run their own shops.”

She continues, “By empowering these women with the right set of skills we have created a potent rural sales force which is involved in direct-selling in rural Punjab and Sindh. Hence, putting these women on-the-path out of poverty.” However, she admits that there is something in it for the company as well because “it makes good business sense for us,” because through these women her company gets “rural penetration”.

The women themselves are not bound to sell Nestlé products in their stores but all do.

Akhtar adds, “When they do direct selling of our products from their shops they earn a commission anywhere between 10-12%.” In addition, they just have to place an order over the phone and the products are delivered at their doorstep on a weekly basis which saves them transport and time, she explains.

Creating pathways to prosperity

Naghma Perween, a mother of six, whose husband retired from the army recently, sits in her shop from 6:00 am till 9:00 pm. She makes a sale of Rs 30,000 every month and a profit of Rs 15,000 monthly. “Now we all eat well,” she says contentedly.

Now in its third year, getting women to become sales agents and shop keepers under the programme was not without its share of teething pains. Getting people like Samiullah motivated enough to become earning members of the family was a time consuming and arduous process.

Iqra Shahzadi works in Nestle as a mobiliser. Initially, she and her team members went about talking to women but they remained unconvinced. Shahzadi says the team then changed strategy and began going door to door to talk to the male members of the household. Though there was a lot of resistance at first, ultimately a few of the male members started asking questions and showed interest, she says.

To expand her business, she recently took an interest-free loan of Rs 40,000 from BISP. “I am able to buy more products and therefore sales have improved,” says Mehdi. While she is unable to save much, she says she never forgets to set aside a daily sum of Rs 50-60 to be able to pay the Rs 2,000 she has to pay as installment.

This interest-free loan to be provided only to the sales agent has been made possible by a grant of Rs 2 million by Nestlé-Pakistan to Akhuwat, a non-profit company, established in 2001, that provides interest-free loans to the marginalised.

Mehdi is sending three of her kids to school, two girls help her with her business and she has a 12-year old special needs daughter, who is now going to a nearby institute that caters to special needs kids. “I found out about this institute only now, when I became more mobile now that I am doing business and meeting people. My daughter is now happier and a far more content person; less prone to tantrums than when she was home all day. Her motor skills have improved and she is even picking up some words,” says the sales agent happily.

“We have observed that for most of the beneficiaries, once the money started pouring in they invested it back in their families and two things remained consistent for most of them: enrolling their children (particularly their daughters) back in school and improved nutritious meals for their families,” says Akhtar.

The National Health Services’ National Nutrition Survey of 2018 (NNS) states that over 50% of Pakistani families are unable to consume even two meals a day, with 36.9%of Pakistani households food insecure, and over 40% children suffer from chronic malnutrition. Given such grim statistics, the company finds it must do its part to raise awareness on nutrition, health and well-being.

“One of the key learnings of this programme has been that good nutrition can be affordable; it is more about making healthier choices,” Akhtar points out.

Studies say women-headed households continue to move up and out of poverty

While all of these women look forward to the quarterly Rs 5,000, chances are these women now doing business may get their names struck off the BISP list. What then?

“It makes sense to strike them off the list if they actually graduate,” says Bhutta. However, he says that since the programme is still in its initial stages, it would be better not to do that because their “incentive to use the asset for income generation is likely to be reduced”.

According to Isa, results from different countries have shown the graduation approach has “gained traction” over time.

He says, “Each has some slightly different variants. But most begin with a grant of an asset along with capacity development of the household members to utilise the asset. Then come other building blocks like mentoring and support, like the development of an ecosystem that helps households link to markets and to value chains in their areas and opportunities to access loans to improve and grow their businesses.”

PPAF’s own trials and studies have found the graduation approach works and that “households continue to move up and out of poverty,” says Isa.

He refers to a 10-year study recently completed in Bangladesh which he says showed that a majority of women-headed households continued to show improvements and that women were now investing in small plots of land as a result.

Isa continues, “If done right the results are extremely heartening,” and calculates that people can be lifted out of poverty in approximately 18 months if the programme (including the provision of microfinance loans) works in a well-oiled manner and without interruption.

The programme has also found more validation, points out Isa. “The economists who evaluated the graduation approach have just been awarded the Nobel Prize for Economics — Esther Dufalo and Abhit Banerjee,” he says.

He adds, “In fact, their endorsement led to its scaling-up.”

Zofeen T. Ebrahim is a Karachi based independent journalist. She has written extensively on development issues including climate change, water, energy, renewables, sanitation, health, diseases, gender, child rights and women’s rights. She tweets



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