Katalyst’s approach is designed to benefit the poor as producers, entrepreneurs, employees or consumers. The livelihoods of poor people depend on market systems in which they are involved as laborers, producers, entrepreneurs and consumers. Often however, the poor are systematically excluded from the markets. Katalyst uses the approach of Making Markets Work for the Poor (M4P) to break this vicious cycle of poverty. M4P identifies the barriers/root causes that prevent poor people’s participation in the markets and finds innovative solutions to overcome them in partnership with the public and private sectors. It partners with wide range of private companies so as to include the poor into their business models. It benefits both – private companies and the poor. As the private companies start catering more to the needs of poor people, the poor gets involved more in the market systems and increasingly gets access to better inputs, services, knowledge and products. Empowering the poor to participate successfully in the markets thus enables the companies to increase their sales which in turn increase their income.
What made the approach work?
Katalyst created a win-win situation: On the one hand, businesses gained millions of new customers by providing small farmers with access to products, inputs, services and know how that help them increase yields and improve quality. On the other hand, new income opportunities for poor farmers were created as they were able to sell competitive products at a fair market price.
In order to support these efforts, Katalyst worked in close cooperation with the public sector, creating and promoting an enabling environment for poor farmers to succeed and businesses to grow. The Government of Bangladesh was a key player and partner of Katalyst’s ongoing efforts to reduce rural poverty.
Katalyst’s work can be seen as being formed of three main streams: