This study aims to improve understanding of the finance of on-site household sanitation through careful analysis of practical field experience in a wide range of projects in Bangladesh, Ecuador, India, Mozambique, Sénégal, and Vietnam. The Sanitation and Hygiene Global Practice Team of the World Bank Water and Sanitation Program (WSP) initially conceptualized this study to offer better guidance to sector professionals developing on-site sanitation projects and programs.

Most of those without sanitation live in rural areas or on the fringes of cities beyond the reach of sewerage networks. The first step up “the sanitation ladder” for those without access will be on-site sanitation. The institutional and financial structures of sewerage and on-site sanitation are so different that it was decided to focus this first study on the issue of basic on-site sanitation.

The study addresses such basic questions as:
• How much does provision of access to on-site sanitation cost, that is, once all costs (hardware and software) are taken into account?
• Do the type and scale of sanitation subsidy affect provision and uptake? How?
• How can the public sector most effectively support household investment in on-site sanitation?
• Should it be via investment in demand stimulation, subsidies to households or suppliers, by support to credit schemes, or by other means?
• Should hardware subsidies be provided or should public spending be focused on promoting demand or supporting the supply side of the market? Where hardware subsidies are adopted, what is the best way to ensure that they reach their intended recipients and are sustainable and scalable?
• What innovative mechanisms (such as credit or revolving funds) can be used to promote household sanitation financing?