108TH CONGRESS

1ST SESSION H. R. 192

AN ACT

To amend the Microenterprise for Self-Reliance Act

of 2000 and the Foreign Assistance Act of 1961to increase assistance for the poorest people indeveloping countries under microenterprise assistance programs under those Acts, and forother purposes.

108TH CONGRESS

1ST SESSION H. R. 192

AN ACT

To amend the Microenterprise for Self-Reliance Act of 2000

and the Foreign Assistance Act of 1961 to increase

assistance for the poorest people in developing countries

under microenterprise assistance programs under those

Acts, and for other purposes.
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1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled,

3 SECTION 1. AMENDMENTS TO THE MICROENTERPRISE FOR

4 SELF-RELIANCE ACT OF 2000.

5 (a) PURPOSES.—Section 103 of the Microenterprise

6 for Self-Reliance Act of 2000 (Public Law 106–309) is

7 amended—

8 (1) in paragraph (3), by striking ‘‘microentre9 preneurs’’ and inserting ‘‘microenterprise house10 holds’’;

11 (2) in paragraph (4), by striking ‘‘and’’ at the

12 end;

13 (3) in paragraph (5)—

14 (A) by striking ‘‘microfinance policy’’ and

15 inserting ‘‘microenterprise policy’’;

16 (B) by striking ‘‘the poorest of the poor’’

17 and inserting ‘‘the very poor’’; and

18 (C) by striking the period at the end and

19 inserting ‘‘; and’’; and

20 (4) by adding at the end the following:

21 ‘‘(6) to ensure that in the implementation of

22 this title at least 50 percent of all microenterprise

23 assistance under this title, and the amendments

24 made under this title, shall be targeted to the very

25 poor.’’.
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1 (b) DEFINITIONS.—Section 104 of such Act is

2 amended—

3 (1) in paragraph (2), by striking ‘‘for micro4 entrepreneurs’’ and inserting ‘‘to microentrepreneurs

5 and their households’’; and

6 (2) by adding at the end the following:

7 ‘‘(5) VERY POOR.—The term ‘very poor’ means

8 individuals—

9 ‘‘(A) living in the bottom 50 percent below

10 the poverty line established by the national gov11 ernment of the country in which those individ12 uals live; or

13 ‘‘(B) living on the equivalent of less than

14 $1 per day.’’.

15 SEC. 2. AMENDMENTS TO THE MICRO- AND SMALL ENTER16 PRISE DEVELOPMENT CREDITS PROGRAM

17 UNDER THE FOREIGN ASSISTANCE ACT OF

18 1961.

19 (a) FINDINGS AND POLICY.—Section 108(a)(2) of

20 the Foreign Assistance Act of 1961 (22 U.S.C.

21 2151f(a)(2)) is amended by striking ‘‘the development of

22 the enterprises of the poor’’ and inserting ‘‘the access to

23 financial services and the development of microenter24 prises’’.
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1 (b) PROGRAM.—Section 108(b) of such Act (22

2 U.S.C. 2151f(b)) is amended to read as follows:

3 ‘‘(b) PROGRAM.—To carry out the policy set forth in

4 subsection (a), the President is authorized to provide as5 sistance to increase the availability of financial services to

6 microenterprise households lacking full access to credit,

7 including through—

8 ‘‘(1) loans and guarantees to microfinance insti9 tutions for the purpose of expanding the availability

10 of savings and credit to poor and low-income house11 holds;

12 ‘‘(2) training programs for microfinance institu13 tions in order to enable them to better meet the fi14 nancial services needs of their clients; and

15 ‘‘(3) training programs for clients in order to

16 enable them to make better use of credit, increase

17 their financial literacy, and to better manage their

18 enterprises to improve their quality of life.’’.

19 (c) ELIGIBILITY CRITERIA.—Section 108(c) of such

20 Act (22 U.S.C. 2151f(c)) is amended—

21 (1) in the first sentence of the matter preceding

22 paragraph (1)—

23 (A) by striking ‘‘credit institutions’’ and

24 inserting ‘‘microfinance institutions’’; and
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1 (B) by striking ‘‘micro- and small enter2 prises’’ and inserting ‘‘microenterprise house3 holds’’; and

4 (2) in paragraphs (1) and (2), by striking

5 ‘‘credit’’ each place it appears and inserting ‘‘finan6 cial services’’.

7 (d) ADDITIONAL REQUIREMENT.—Section 108(d) of

8 such Act (22 U.S.C. 2151f(d)) is amended by striking

9 ‘‘micro- and small enterprise programs’’ and inserting

10 ‘‘programs for microenterprise households’’.

11 (e) AVAILABILITY OF FUNDS.—Section 108(f)(1) of

12 such Act (22 U.S.C. 2151f(f)(1)) is amended by striking

13 ‘‘for each of fiscal years 2001 and 2002’’ and inserting

14 ‘‘for each of fiscal years 2001 through 2004’’.

15 (f) CONFORMING AMENDMENT.—Section 108 of such

16 Act (22 U.S.C. 2151f) is amended in the heading to read

17 as follows:

18 ‘‘SEC. 108. MICROENTERPRISE DEVELOPMENT CREDITS.’’.

19 SEC. 3. AMENDMENTS TO THE MICROENTERPRISE DEVEL20 OPMENT GRANT ASSISTANCE PROGRAM

21 UNDER THE FOREIGN ASSISTANCE ACT OF

22 1961.

23 (a) FINDINGS AND POLICY.—Section 131(a) of the

24 Foreign Assistance Act of 1961 (22 U.S.C. 2152a(a)) is

25 amended to read as follows:
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1 ‘‘(a) FINDINGS AND POLICY.—Congress finds and de2 clares that—

3 ‘‘(1) access to financial services and the devel4 opment of microenterprise are vital factors in the

5 stable growth of developing countries and in the de6 velopment of free, open, and equitable international

7 economic systems;

8 ‘‘(2) it is therefore in the best interest of the

9 United States to facilitate access to financial serv10 ices and assist the development of microenterprise in

11 developing countries;

12 ‘‘(3) access to financial services and the devel13 opment of microenterprises can be supported by pro14 grams providing credit, savings, training, technical

15 assistance, business development services, and other

16 financial and non-financial services; and

17 ‘‘(4) given the relatively high percentage of pop18 ulations living in rural areas of developing countries,

19 and the combined high incidence of poverty in rural

20 areas and growing income inequality between rural

21 and urban markets, microenterprise programs

22 should target both rural and urban poor.’’.

23 (b) AUTHORIZATION.—Section 131(b) of such Act

24 (22 U.S.C. 2152a(b)) is amended—
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1 (1) in paragraph (3)(A)(i), by striking ‘‘entre2 preneurs’’ and inserting ‘‘clients’’; and

3 (2) in paragraph (4)(D)—

4 (A) in clause (i), by striking ‘‘very small

5 loans’’ and inserting ‘‘financial services to poor

6 entrepreneurs’’; and

7 (B) in clause (ii), by striking ‘‘micro8 finance’’ and inserting ‘‘microenterprise’’.

9 (c) MONITORING SYSTEM.—Section 131(c) of such

10 Act (22 U.S.C. 2152a(c)) is amended by striking para11 graph (4) and inserting the following:

12 ‘‘(4) adopts the widespread use of proven and

13 effective poverty assessment tools to successfully

14 identify the very poor and ensure that they receive

15 needed microenterprise loans, savings, and assist16 ance.’’.

17 (d) DEVELOPMENT AND APPLICATION OF POVERTY

18 MEASUREMENT METHODS.—Section 131 of such Act (22

19 U.S.C. 2152a) is amended—

20 (1) by redesignating subsections (d) and (e) as

21 subsections (e) and (f), respectively; and

22 (2) by inserting after subsection (c) the fol23 lowing:
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1 ‘‘(d) DEVELOPMENT AND CERTIFICATION OF POV2 ERTY MEASUREMENT METHODS; APPLICATION OF METH3 ODS.—

4 ‘‘(1) DEVELOPMENT AND CERTIFICATION.—(A)

5 The Administrator of the United States Agency for

6 International Development, in consultation with

7 microenterprise institutions and other appropriate

8 organizations, shall develop no fewer than two low9 cost methods for partner institutions to use to assess

10 the poverty levels of their current or prospective cli11 ents. The United States Agency for International

12 Development shall develop poverty indicators that

13 correlate with the circumstances of the very poor.

14 ‘‘(B) The Administrator shall field-test the

15 methods developed under subparagraph (A). As part

16 of the testing, institutions and programs may use

17 the methods on a voluntary basis to demonstrate

18 their ability to reach the very poor.

19 ‘‘(C) Not later than October 1, 2004, the Ad20 ministrator shall, from among the low-cost poverty

21 measurement methods developed under subpara22 graph (A), certify no fewer than two such methods

23 as approved methods for measuring the poverty lev24 els of current or prospective clients of microenter-
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1 prise institutions for purposes of assistance under

2 this section.

3 ‘‘(2) APPLICATION.—The Administrator shall

4 require that, with reasonable exceptions, all organi5 zations applying for microenterprise assistance

6 under this Act use one of the certified methods, be7 ginning no later than October 1, 2005, to determine

8 and report the poverty levels of current or prospec9 tive clients.’’.

10 (e) LEVEL OF ASSISTANCE.—Section 131(e) of such

11 Act, as redesignated by subsection (d), is amended by in12 serting ‘‘and $175,000,000 for fiscal year 2003 and

13 $200,000,000 for fiscal year 2004’’ after ‘‘fiscal years

14 2001 and 2002’’.

15 (f) DEFINITIONS.—Section 131(f) of such Act, as re16 designated by subsection (d), is amended by adding at the

17 end the following:

18 ‘‘(5) VERY POOR.—The term ‘very poor’ means

19 those individuals—

20 ‘‘(A) living in the bottom 50 percent below

21 the poverty line established by the national gov22 ernment of the country in which those individ23 uals live; or

24 ‘‘(B) living on less than the equivalent of

25 $1 per day.’’.
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1 SEC. 4. REPORT TO CONGRESS.

2 (a) IN GENERAL.—Not later than September 30,

3 2005, the Administrator of the United States Agency for

4 International Development shall submit to Congress a re5 port that documents the process of developing and apply6 ing poverty assessment procedures with its partners.

7 (b) REPORTS FOR FISCAL YEAR 2006 AND BE8 YOND.—Beginning with fiscal year 2006, the Adminis9 trator of the United States Agency for International De10 velopment shall annually submit to Congress on a timely

11 basis a report that addresses the United States Agency

12 for International Development’s compliance with the

13 Microenterprise for Self-Reliance Act of 2000 by

14 documenting—

15 (1) the percentage of its resources that were al16 located to the very poor (as defined in paragraph (5)

17 of section 131(f) of the Foreign Assistance Act of

18 1961 (22 U.S.C. 2152a(f)(5))) based on the data

19 collected from its partners using the certified meth20 ods; and
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1 (2) the absolute number of the very poor

2 reached.

Passed the House of Representatives May 14, 2003.

Attest:

Clerk.