1. Targeted Subsidies in a Sanitation Marketing Context
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Session 3c: Financing approaches to reach the poor
Alicia May | July 14

2. Targeted Subsidies Play a Key Role
Sanitation Marketing Scale Up (SMSU)
22%
Purchasers are IDPoor
Current SMSU 2 program explores how to capture the majority and laggards
What models and tools can be used for deeper penetration into the poorest segments?

3. What is pilot operational model?
SanMark Model
Designing to context and building markets by facilitating demand and supply
Independent Sales Agents 1
Rural Household 2 3
( MFI Evaluation )
Independent Suppliers 4 5
Rural Household

4. Who receives the targeted subsidy?
SanMark Model
Designing to context and building markets by facilitating demand and supply
Independent Sales Agents 1
Rural Household 2 3
( MFI Evaluation )
Independent Suppliers 4 5
Rural Household

5. How are households targeted?
Pilot Area Villages
Pilot Details:
166 villages
Pilot ongoing
Randomized control trial conducted by Causal Design
Control Villages
Treatment Villages
ID Poor Subsidy
Cash and Loans Sales
Cash and Loans Sales
ID Poor Subsidy

6. What works and what’s challenging?
How effective are these tools in reaching the poor?
Preliminary results:
Effectively targeting the poor
Treatment Village: 51% treatment sales are poor
How are targeted subsidies impacting non-poor sales?
Statistically insignificant effect on non-poor sales when subsides are offered in their village
Exacting sales technique when subsides offered; continue to monitor

7. What works and what’s challenging?
How attractive are loans to rural Cambodian families?
Preliminary data:
Smaller than anticipated loan utilization
30% of total sales are loans
84% of loans being used by the non-poor
Will continue to monitor as pilot progresses
Loans alone are not the magic bullet, subsidies needed too
Maintaining close relationship with MFI partner is key