Updated Apr 15, 2020

Fundación Paraguaya - Poverty Stoplight


Joseph Ukaegbu

During the COVID-19 pandemic, FP is developing new ways to deliver microfinance loans to those who are extremely poor and vulnerable and has been able to reach more than 3,500 village banks and 70,000 microenterprises.

The problems that we are addressing are the limitations of current approaches to measurement of multidimensional poverty and the ways in which NGOs, governments and international development agencies mostly use top-down approaches to address poverty. Poverty Stoplight breaks down the overwhelming concept of poverty into smaller, more manageable problems that can be solved through simple interve...
The problems that we are addressing are the limitations of current approaches to measurement of multidimensional poverty and the ways in which NGOs, governments and international development agencies mostly use top-down approaches to address poverty. Poverty Stoplight breaks down the overwhelming concept of poverty into smaller, more manageable problems that can be solved through simple interventions, making the invisible visible in the shape of simple, understandable indicators.
How does your innovation work?
The long term vision of the Poverty Stoplight is a world without poverty where all want to live. Its mission is to activate the potential of individuals and families to eliminate multidimensional poverty through self-evaluation tools that allow the discovery of practical and innovative solutions. Using a self-evaluation survey of 50 multidimensional indicators, the methodology breaks down the complex concept of poverty into three easy definitions for each indicator: extremely poor (marked as red), poor (yellow), and not poor (green). Once each family’s poverty has been defined through the self-diagnostic, the family becomes the chief architect in a customized poverty elimination plan of their creation: solutions are innovated based on pre-existing family knowledge/skills, by their surrounding community, or provided by private businesses, civil society organizations, or government bodies offering goods and services. The Poverty Stoplight methodology is currently implemented in three different contexts: within FP’s microfinance program, within 82 Paraguayan private businesses and within organizations in 23 countries in various phases of implementation. Our Scale-up Strategy outlines specific objectives and milestones for the next 5 years, including the creation of numerous Stoplight HUBS worldwide.
Economic and Workforce Support
Schwab Foundation

Stage 5: Scaling

The Poverty Stoplight has been tested in various contexts since 2011. We developed a Scaling Up Strategy which is ready for roll-out, focusing on scaling up the technology platform for data gathering, expanding the number of international HUBS and strengthening communications. Existing partners and organization worldwide have expressed interest in using and adapting the Poverty Stoplight. The time has come to scale it up globally.
Registered in Paraguayin Paraguay

Focus Areas:

Economic Growth and Trade, Leadership Development, Entrepreneurship and 3 MoreSEE ALL

Economic Growth and Trade, Leadership Development, Entrepreneurship, Social & Micro Finance, Digital Inclusion & Connectivity and TechnologySEE LESS

Implemented In:

Mexico, Nicaragua, Nigeria and 19 MoreSEE ALL

Mexico, Nicaragua, Nigeria, Tanzania, Dominican Republic, Senegal, Taiwan, Uganda, Kenya, Argentina, Chile, China, Colombia, Ecuador, El Salvador, Pakistan, Paraguay, South Africa, Spain, Costa Rica, Singapore and United KingdomSEE LESS

Countries Implemented In
Verified Funding

Mission and Vision

At Fundación Paraguaya we implement the Poverty Stoplight with our microfinance clients, with our own 469 employees, with 82 private enterprises, as well communities through partnerships with the public and private sector. In our microfinance program, we can certify that so far 3,791 families using the Stoplight have overcome multidimensional poverty and 21,182 families overcame income poverty. We are working with organizations in 23 countries who have adapted the Poverty Stoplight indicators. Partners include UNICEF China, Heifer International, the American University of Nigeria, the Clothing Bank (South Africa), the Enabler Foundation (India), Women’s Global Empowerment Fund (Uganda), Transmit Enterprise (UK) and Junior Achievement (Latin America), among others. Our monitoring and evaluation system helps us to track both program implementation and outcomes. We have specified annual poverty elimination objectives, and we check our microfinance clients’ progress who are applying the Poverty Stoplight, in reaching these targets on a monthly basis. A comprehensive evaluation that estimates the program’s effect based on an experimental research design using randomization is currently being conducted. Key program activities, such as the application of the Stoplight and mentoring visits, are monitored in real time. We also have an external audit team that validates the results reported by our field workers. About 5% of the results get audited.

Competitive Advantage

When we kept seeing our clients having poverty-related problems despite doubling their income, we set ourselves the goal to better understand what it means not to be poor in Paraguay. In this quest we found a lot of indexes that aimed to measure multidimensional poverty, but did a poor job of helping a grassroot organisation, or an impoverished family do something about it. The main stakeholders - families affected by poverty - were not taken into account as protagonist, only as units of observation. What we did is create an easy-to-understand pictographic questionnaire with actionable indicators (the “Stoplight”) and put it into a tablet with the help of Hewlett Packard. Families can self select where they think they are in each of the 50 indicators. When the self diagnostic is finished, information can be aggregated centrally but also stays with the family in the form of a “life map”. Impoverished families have few spaces to reflect on where they are at and where they want to be: so many public and private interventions do not take this into account and neglect the unique perspectives and resources that already exist in a community. The Poverty Stoplight differentiates from other tools in that it is the most comprehensive tool and the only one that has a self-assessment component. It is the only one which has been designed to cover only those indicators that are actionable so the families and individuals can turn around the conditions they prioritize.

Planned Goals and Milestones

Fundacion Paraguaya currently has a 5-year scale-up strategy for the Poverty Stoplight. The goal is to make the Stoplight the tool of choice for participatory poverty analysis and action for use by like-minded organizations across the world. Our aim is to have 200,000 Stoplight users by 2021. The strategy includes three main objectives. 1 - Improving the practice of the Stoplight methodology, 2 - Strengthening Data Management Systems including an upgraded and expanded technological platform, and 3 - Testing potential clients and services for expanded use of the Stoplight, focusing on three product lines and 10 countries. We have identified the following Milestones: 2017 – Tech platform upgrade for data gathering, cognitive survey and in-depth interviews to consolidate the Poverty Spotlight and MPI (Oxford), Poverty Stoplight HUBS in 4-6 countries and Local and global website launch 2018 – Tech upgrade includes dashboard, automatized reporting and data visualization, a launch portal for partners, outcome tracking, a defined impact evaluation strategy and Poverty Spotlight HUBS in 6-12 countries 2019 – Open source launch platform, randomized control trial (RCT) roll-out, Poverty Stoplight HUBS in 12-18 countries 2020 – Data analytics, adaptation based on RCT results and Poverty Stoplight HUBS in 30 countries 2021 – Poverty Stoplight HUBS in 50 countries In order to achieve these milestones we will need to recruit a number of new staff and consultants.


May 2015
Funds RaisedVERIFIED
Implemented InTanzania
Date Unknown
New Country Implemented In
Date Unknown
New Country Implemented In