The Government of Nepal created PAF to reduce extreme poverty in Nepal and build a democratic, just, equitable and sustainable society.
Poverty Alleviation Fund (PAF)was established in 2003 as a special and targeted programme to bring the excluded communities in the mainstream of development, by involving the poor and disadvantaged groups themselves in the driving seat of development efforts. So, PAF seeks to o improve living conditions, livelihoods and empowerment among the rural poor, with particular attention to groups that have traditionally been excluded by reasons of gender, ethnicity, caste and location.
PAF is contributing on bringing the level of poverty down to 10 percent in 20 years in pursuant with the long term goal of Government of Nepal; and reduce poverty by half by the year 2015 as per the Millennium Development Goals (MDGs). With the recent addition of 15 districts, the total programme districts of PAF have reached to 55. Remaining 20 districts will be covered through poverty pocket approach.
PAF is financed by the Government through a succession of IDA grants from the World Bank.
Initially established by an ordinance in 2003, PAF is governed by an act since 2006. Thus PAF is an autonomous, independent and professional organization governmed by a separate law.
The PAF board consists of 8 members where board is chaired by the Rt. Honorable Prime Minister of Nepal.
The Vice-chairperson and five other members--are appointed by the government from among the development professionals. The secretary is a member representative from National Planning Commission.