Cashpor House Index (CHI)

CASHPOR uses a tool, the CASHPOR Housing Index (CHI), to identify poor household in cost effective manner. It is an
index based on the height of the wall and material used in the wall and roof of a house. Poor people struggle for food and
clothing and they live in small houses, made of locally available materials with their own labour (means no cost is involved).
The logic of CHI is based on the premise that poor people spend their money on basic necessities (food, clothes, diseases
etc.) and social obligations (daughters marriage, death ceremony etc), while any surplus is invested in their houses. A good
house not only reduces their vulnerability, but denotes higher social status and self esteem. Therefore, the quality of house is
a reflection of prosperity of the household.
The number of poor households in a village is determined by use of the CASHPOR House Index (CHI).The CHI has been
further adapted for use in eastern UP and Bihar. As it is an area of long established settlement, houses tend to be larger than
in more recently settled areas. Double-storey houses are still excluded, but otherwise, size of the house is not a critical
indicator. Rather height and materials of the walls and materials of the roof have become the key indicators. Further in view
of the recent Government policies, various State Governments have been issuing patta land and Indira Awaas (oneroom
pucca houses) to the poor people. Such land and houses are to be ignored, provided their occupants fulfil the asset norms of
CASHPOR.

Cashpor Housing Index

a. Height of the Walls and Materials used

Score

i.

More Than 5 feet and made of brick.

ii.

More than 8 feet and made of mud.

iii. Between 4 and 8 feet and made of mud.

b. Materials of Roof
i.

Concrete/Pucca/Patia/New Tiles/GI Sheet

ii.

Old Tiles /GI Sheet

iii. Thatch/Straw/Plastic/Leaves
c. Maximum Score

0
6

d. Poverty Status
i.

Non Poor

ii.

Moderately Poor (MP)

iii. Very Poor (VP)

4 or more
3
2 or less

e. If the house index score is =<4 and for the occupants of government allotted houses,
you must conduct the asset interview.
Following households are not eligible for our program:

Households, where any member has any type of motor vehicle, like a motor bike, car,
jeep, van, tractor, hand tractor, etc.

The house is built with brick walls and a reinforced concrete roofn(excluding the
Government allotted houses).

The Form No.1 is not to be filled-in for such cases, unless they appeal that despite their motor
vehicle or big house their status is Below the Poverty Line (BPL).

Appeal cases
Sometimes while the CM is interviewing the potential clients, occupants of neighbouring
houses that scored four or more, will ask to be interviewed, saying that they are also poor.
1. In such cases, a Form No.1 has to be filled-in for them and they are to be told that their
request will be referred to the Branch Manager/Supervisor who will call upon them as soon
as possible. The Form No.1 for the appeal case is to be handed to the Branch Manager.
2. The BM must visit such appeal cases and conduct a thorough verification to find out
whether the family satisfies the above mentioned criteria for the MP/VP except for the score
on the CHI.
3. The BM must conduct an asset interview and should do physical verification as well.
4. If the BM is satisfied that the family is poor, s/he will endorse it on the Form no.1. The
CHI score would, however, remain unchanged and the woman can join a group/center despite
a
higher score on the CHI.

How is the PPI created?

1. Start the representative national income/ expenditure survey.
2. Analyze the data to rank indicators that strongly correlate with poverty.
3. Indicators are tested and vetted with local MFIs and representatives.
4. Results are highly accurate with 90% confidence most PPIs are accurate within +/ -1 -3% with
sufficient sample size.

Progress out of Poverty Index for India

Indicator

How many people aged 0 to 17 are in the house

hold.

Value

Points

A. Five or more

0
4
8
13
20
27

B. Four
C. Three
D. Two
E. One
F. None
2

What is the house holds principal occupation.

A. Laborers
0
(agricultural,
plantation, other
farm, hunters,
tobacco prepares, 8
product market
and other
14
laborers)
B. Others
C. Professionals,
technicians,
clerks,
administrators,
managers =,
executives,
directors,
supervisors and
teachers.

Is the residence all pucca (burnt bricks, stone,

cement, concrete, jackboard/ cement-plastered
reeds, timber, tiles, galvanized tin or asbestors
cement sheets)?

A. No

What is the households primary source of

energy for cooking?

A. Firewood and
chips, charcoal,
or none.

0
4

B. Yes

0
5
17

B. Others
C. LPG
5

Does the household owns a television?

A. No

0
6

B. Yes
6

Does the household own a bicycle, scooter, or

motorcycle?

A. No

0
5

B. Yes
7

Does the household own an almirah/dressing

table.

A. No

0
3

B. Yes
8

Does the household owns a swing machine?

A. No

0
6

B. Yes
9

How many pressure cooker or pressure pans

does the household owns?

A. None

0
6
9

B. One
C. Two or more
10 How
many
electric
fans does
the
household
owns?

A. None
B. One
C. Two or more

0
5
9

Progress out of
Poverty Index
Tool Review
Review Overview
Accuracy - 7
Ease of use - 9
Usefulness - 10
8.7

Summary : An easy to use tool that measures poverty with just 10 questions. Already
customised and translated for many different countries.
Download the PPI

The $1.25 per day international poverty line is the most commonly used measure of poverty.
International agencies use it, donors use it, and many NGOs and microfinance institutions
want to make sure their programs are reaching people below this line.
Unfortunately, determining whether a family actually lives on less than $1.25 per person per
day can be extremely challenging it's not as simple as asking how much they earn. To start
with the $1.25 per day line isn't even measured in dollars, pesos or rupees. It's measured in
mysterious economic units called Purchasing Power Parity (PPP) which takes into account
currency differences and exchange rates. Add to this the fact that many families grow crops
or raise animals which they eat (or barter with), and have several informal loans going

simultaneously, and you start to wonder whether it's even possible to know if a family lives
below the magic $1.25 PPP.
The Progress out of Poverty Index or PPI for short was created by the Grameen
Foundation to address exactly this problem. It uses 10 simple questions, such as What
material is your roof made out of? or How many of your children are in school? to
determine the likelihood that a particular household is living below the poverty line. The best
part is that the tool has already been customised for 45 countries and can be downloaded for
free on their website www.progressoutofpoverty.org (you must register first). Translations of
the tool into local languages are also available from the website, although it took a while to
find them at the very bottom of the download page.
How does it work?

The Grameen Foundation created each of the country PPI tools by looking at hundreds of
questions in national household surveys to see which ones were most strongly related to
poverty. The top 10 most powerful questions were selected through a combination of
statistical analysis and expert judgement, and these became the PPI tool. Each country has a
different set of 10 questions These are the ones for Cambodia:
1. How many members does the household have?
2. How many children ages 7 to 15 attend school?
3. What is the primary construction material of the outer wall of the dwelling
unit occupied by the household?
4. What type of fuel does the household mainly use for cooking?
5. What toilet facility does the household have?
6. How many bicycles and motorcycles does the household own?
7. Does the household own a bed set?
8. Does the household own a wardrobe or cabinet?
9. Does the household own a water pump?
10.Does the household own a television?

The answers for each question are multiple choice, and each answer is assigned a score.
Below you can see an example of the answers and scoring for one of the Cambodian
questions:
Q6. How many bicycles and motorcycles does the household own?
o

A. No bicycles, and no motorcycles = 0 points

B. One bicycle, and no motorcycles = 4 points

C. Two bicycles, and no motorcycles = 4 points

D. Three or more bicycles, and no motorcycles = 11 points

E. One or more motorcycles (regardless of bicycles) = 13 points

Once the survey is complete you just add up the total score for all 10 questions. The total
score can range from 0 (extremely poor) to 100 (not poor). Now that you have the total score
for the household, you then use a table to lookup the probability that the household is below a
particular poverty line. For example if a Cambodian household had a score of 27, then based
on the lookup table their probability of being below the $1.25 per day international poverty
line is 39.8%.

Source: Cambodia PPI indicators and lookup table

One of the great things about the PPI tool is that it includes tables for lots of different
poverty lines, including the $1.25 per day international poverty line, the national poverty line
for the country in question, the food poverty line, and the USAID extreme poverty
line. One of the more confusing things about PPI is that households are given a percentage
likelihood of being below the poverty line, rather than simply saying they are definitely
below it. This may not be intuitive for some people, and has the potential to cause
confusion when I used this tool in practice I had a lot of difficulty explaining to people
what a 39.8% chance of being below the poverty line actually meant.
However, once you have calculated the likelihood that each household is below the poverty
line, you can then average these results to estimate the total percentage of households that are
below the poverty line (which is very clear and unambiguous). Below is an example with data

from 10 households, which shows that approximately 25% of all the households in the
sample are living below $1.25 per day.

What is it like to use in practice?

For one of the programs I worked on in Cambodia we used the PPI tool to measure the
poverty of 1300 HIV positive women at the start of the program (baseline) and end of the
program (endline). We only had a small budget, so we used our own field staff to collect the
data rather than professional data collectors.
Most of our field staff had completed at least 9 years of school and could read and write.
After a short training session they found the tool very easy to use, although a few of the
questions caused confusion. For example, the question How many children ages 7 to 15
-attend school? did not have a not applicable option for families without children aged 715 years. Some staff were also confused by the question Does the household own a bed
set?, since they were not sure whether a bamboo platform counted as a bed or whether it
had to be made out of wood, and if so, did it need to be raised off the ground? To address this
we made a few minor adjustments to some of the question answers, and created our own
guide for training the staff.
Once all the staff were trained and data collection started, each survey took less than 15
minutes to complete. The data collectors visited every house in order to confirm answers to
questions such as Does the household own a television? through observation. However,
home visits are not always possible, and so we also tried it without home visits and received
relatively accurate answers based on what we knew about their home situation.
We found entering the data very quick and easy since there were only 10 questions, all with
numerical scores. The tool came with a clear instruction guide, check-lists, and even a
ready made Excel spreadsheet for entering the data! Although the basic instruction guide was
easy to follow, it did not clearly explain how to calculate the total percentage of households
below the poverty line by averaging the likelihoods for all households. I had to look in the
advanced guide for that information, which was a bit intimidating since it includes all the
gory details of the statistical methods they used to make the tool.

What do the results look like and how can they be used?

After entering all the data we were left with a list of the households, their
corresponding PPI score and the likelihood they were below the poverty line (similar to the
table above). Individual household scores like this have a variety of uses. One of the main
uses is to determine which households should be selected for a program. For example, you
might only select households with a score of less than 25, because they are most likely to be
below the poverty line. Of course, not every tool is perfect, so there will always be some false
positives (people being included who are not actually below the poverty line) and false
negatives (people being excluded who are really below the poverty line). You can also use
individual household scores at the start and end of the program to see how a family's situation
has changed over time.
The PPI tool really comes into its element when looking at results for groups of
households. For example, if you collect PPI scores from a representative sample of
households you can then make a chart like the one below, which shows how the households
are distributed on the PPI scale from 0 to 100.

If you do this at the start and end of your program, or periodically during the program, you
can see how the participants become wealthier or poorer over time (see chart below).

Another way of showing changes in poverty over time is to calculate the percentage of
households below the poverty line at the start and end of the program and show it in a bar
chart. The example below shows that at the start of the program 49% of households lived on
less than $1.25 per day, and by the end of the program this had dropped to 32%.

What are the limitations?

One of the great benefits of the PPI is that it is based on nationally representative surveys,
and so it is perfect for use with the general population. This can also be a downside if you are
using it with a very specific group who may experience poverty differently. For example, our
staff raised the concern that widows who were only recently diagnosed with HIV may still
have all their household belongings (and so score highly on the PPI) but may be too sick to
work, and so they might actually be living below the poverty line. Situations like this may
require some modifications to the tool, although in our case most of the women had been
diagnosed 5-10 years previously, and so this was not a major concern.
Another problem with the PPI is that it is only a very rough measure of poverty, and so it
was not able to easily measure the very small changes in household situation as a result of our
program. It is also limited to a scale of 0 to 100, so we found that although some families in
extreme poverty had their situation become worse between the start and end of the program,
this was not picked up by the instrument because they were already at the very bottom of the
scale. Similarly, some of the wealthy families in the program became richer during the
program, but because they were already near the top of the scale this was not picked up.
The bottom line

The Progress out of Poverty Index is an fantastic creation by the Grameen Foundation.
Although there are many other tools available to measure poverty, the PPI tool is
particularly easy to use, well documented, and is already customised and translated for a wide
range of countries.
The PPI tool is a good choice when:

You need to know how many of your program participants are below the
poverty line.

You want to select program participants based on whether or not they are
below the poverty line.

You need to measure changes in poverty over time.

You want to tailor parts of the program or service to an individual's poverty

level.

You are using field staff to collect the data rather than professional data
collectors.

You have a limited amount of time to collect the data.

You have limited statistical skills.

The PPI tool is NOT a good choice when:

You want to measure very small changes in poverty or living conditions for
individual households.

You are conducting quantitative research and want to use the results in
complex bivariate or multivariate statistical analysis (the limited scale
makes this difficult).

There is another official tool that you should be using based on national or
donor requirements.

Your data collection staff have low literacy.