The paperback edition of Portfolios of the Poor: How the World's Poor Live on $2 a Day (Princeton University Press, 2009) is now available.

One of the main lessons of recent financial diaries research is that low income often means erratic income. If you live on $2 a day, you don’t get two bucks each morning—you might make money at the beginning of the month and then not see another paycheck until weeks later.

Microcredit started with a simple financial product – the idea of group lending.  Since then, much work on financial inclusion revolved around refining products.  The field has made a lot of progress,  but there is still much to do: structuring products that address poor people’s real needs, packaging them with rewards they value, reminders they find useful, and constraints that help them maintain discipline. Moreover, these products need to permit transactions that are sized and timed in a way that is consistent with their cash flows.