Poverty Probability Index
Also known as: PPI, Progress out of Poverty Index, Poverty Scorecard, Poverty Likelihood Scorecard
The Poverty Probability Index (PPI), formerly the Progress out of Poverty Index, is a simple, country-specific scorecard that estimates the likelihood that a household is living below a given poverty line. Developed by Mark Schreiner and disseminated first by the Grameen Foundation and later by Innovations for Poverty Action, it reduces poverty measurement to ten easy-to-answer, verifiable questions about household characteristics. The answers produce a score from 0 to 100, which a calibration table converts into the probability that the household falls below national or international poverty lines — a low-cost alternative to a full consumption survey for organizations that need to track the poverty profile of the people they serve.
Key highlights
- Extremely low cost and fast: ten simple questions and a sum let non-expert staff estimate poverty without a full consumption survey.
- Statistically grounded — indicators and points are derived from a national survey calibrated against an actual poverty line, not chosen by intuition.
- Outputs an interpretable poverty probability and group poverty rate that can be tracked over time and compared to national and international lines.
- Standardized, certified, country-specific scorecards make results comparable across organizations using the same instrument.
Intuition
This section is available to Pro members. Upgrade to Pro
How it works
This section is available to Pro members. Upgrade to Pro
When to use it
Use the PPI when an organization — a microfinance institution, social enterprise, or NGO — needs a cheap, fast, repeatable estimate of the poverty profile of its clients or beneficiaries and cannot run a full consumption survey. It is well suited to targeting, segmenting, and tracking poverty outreach over time at the group level, and to social-performance reporting. It must use the certified, up-to-date scorecard for the specific country and poverty line, since the calibration is country- and survey-specific. It is not designed to classify an individual household as definitively poor or non-poor (it gives a probability, not a verdict), nor to replace official poverty statistics or measure non-monetary deprivation.
Strengths & limitations
- Extremely low cost and fast: ten simple questions and a sum let non-expert staff estimate poverty without a full consumption survey.
- Statistically grounded — indicators and points are derived from a national survey calibrated against an actual poverty line, not chosen by intuition.
- Outputs an interpretable poverty probability and group poverty rate that can be tracked over time and compared to national and international lines.
- Standardized, certified, country-specific scorecards make results comparable across organizations using the same instrument.
- It estimates a probability for groups, not a definitive poor/non-poor classification for an individual household, so it is weak for hard eligibility decisions.
- Each scorecard is country- and line-specific and must be recalibrated as new national surveys appear, or it drifts out of date.
- Predictive accuracy depends on the strength of the indicator-poverty relationship in the original survey, which varies by country and poverty line.
- It measures monetary poverty likelihood only and captures no multidimensional or non-income deprivation.
Common pitfalls
This section is available to Pro members. Upgrade to Pro
Applications
This section is available to Pro members. Upgrade to Pro
Frequently asked
Does a PPI score tell me whether a specific household is poor?
No. The PPI gives a probability, not a verdict. A score points into a calibration table that says what fraction of households with that score were below the poverty line in the reference survey. For a single household the right reading is 'this household has, say, a 60 percent likelihood of being below the line', and the tool is designed to be averaged over a sample to estimate a group poverty rate. Using it to make a yes/no eligibility decision for one household goes beyond what the instrument was built to do.
Why must I use the official scorecard for my country?
Both the choice of indicators and the points attached to each answer, as well as the score-to-likelihood lookup table, are estimated from a specific national household survey and a specific poverty line. Those relationships differ across countries and over time, so a scorecard built for one country or an old survey will mis-predict poverty elsewhere. Certified, country-specific scorecards are published and periodically refreshed as new national surveys become available, and using the current certified version is what makes the estimates valid and comparable.
How does the PPI relate to a proxy means test?
Both predict an unobserved welfare measure from easy-to-observe household characteristics. A proxy means test is usually used to make individual eligibility decisions for a program and predicts a continuous welfare level, whereas the PPI is calibrated to output the probability of being below a poverty line and is intended for estimating and tracking poverty rates at the group level. They share the same statistical logic but differ in purpose: classification versus poverty-rate measurement.
Sources
- 1.Schreiner, M. (2016). The Poverty Probability Index (PPI): A Brief on Calculating Annual Poverty Rates and Movement Across a Poverty Line. Innovations for Poverty Action / PovertyIndex.org.
- 2.Schreiner, M. (2002). Scoring: The Next Breakthrough in Microcredit? CGAP Occasional Paper 7. Consultative Group to Assist the Poor, Washington, DC.
You have read it. What now?
Cite this page
ScholarGate. (2026, June 22). Poverty Probability Index. ScholarGate. https://scholargate.app/development-studies/progress-out-of-poverty-index