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IDB loan to benefit 100,000 poor households in rural Honduras

IDB gives $75 million loan for Honduras conditional cash-transfer program

The Inter-American Development Bank (IDB) approved a $75 million loan for the Honduran conditional cash transfer program known as Bono 10,000, to help strengthen the human capital of 100,000 poor households in the country’s rural areas.

The program’s resources will finance an annual payment voucher of $505 for each household (equivalent to 10,000 Lempiras, the local currency), which represents 20.5 percent of the annual income of beneficiary families.

The families will receive the vouchers on the condition that their children enroll in school and attend classes 80 percent of the time. In addition, the families must make use of preventive health services for children aged five and under, and women must receive pre- and postnatal care.

The aim of the program is to reduce poverty in the beneficiary communities through improvements in education and health. It will increase the number of children who complete primary education through grade nine. The program also aims to reduce the incidence of anemia and increase full vaccination coverage for children under age five. In addition, more women will receive pre- and postnatal care provided by qualified health workers.

Another program goal is to increase the efficiency of Bono 10,000’s operations by strengthening decentralization and improving management techniques and information systems for tracking households benefiting from the program and verifying that they are meeting their responsibilities.

Improvements in the information system will be coordinated with the National Statistics Institute. Data from Honduras’ 2013 census will be compared with the registry of beneficiaries to minimize errors of exclusion and inclusion. Innovative mechanisms will be used to deliver the payment vouchers, including cell phones and the network of savings and loan cooperatives, as a way to reduce transportation costs and increase security for beneficiary families.

The Honduran government created Bono 10,000 in 2010. Since then, the initiative has benefited more than 210,000 households, which represent 40 percent of the country’s population living in poverty.

Of the program’s total cost of $82.5 million, the IDB is funding $75 million. The IDB financing includes $52.5 million from ordinary capital and $22.5 million from the Fund for Special Operations. Counterpart funding from Honduras totals US$7.5 million.

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