PIP: Thailand's pilot Community-based Incentives Program in the northeast illustrates the high level of contraceptive prevalence that can be achieved when entire communities profit from economic incentives. This particular community incentives program began in 1983 with funding from the Special Projects Fund of the Population Crisis Committee under the auspices of Thailand's largest nongovernmental organization, the Population and Community Development Association (PDA). PDA, with its long and impressive record as a grassroots family planning service network, had almost a decade of experience in creating demand for family planning by offering income generating incentives to individuals. Through the community incentives program, PDA used the grant from abroad to establish loan funds of about $2000 in each of 6 villages. The loan funds grew in size as the overall contraceptive prevalence rate in the villages increased. Loans between $80 and $200 were made available to villagers for income-generating activities, mostly to buy fertilizer, rent tractors, or hire workers for planting and harvesting the local crops. Elected villagers administered the funds and reviewed loan applications with assistance from PDA. By the end of 2 years, loans totaling $72,000 had been granted in the 6 villages, and 75% of all village households had received at least 1 loan. Repayment was nearly 100% on schedule with no defaults. The 6 loan funds are still operating in 1986 but without outside assistance. Contraceptive practice increased from 46% to 75% of all married women aged 15-44 in the 6 villages between 1983-85. In a comparative study of 3 villages in which no loan fund operated, contraceptive prevalence increased from 51% to only 57%. In the Thai experience, the private PDA appears to have several advantages over the central government in implementing a community incentives approach: because PDA works closely with community members, it is able to determine community needs, involve the community in decisionmaking, and create the foundation for community self-management; it is able to provide close supervision to assure that performance is rewarded; and it may be perceived as a more credible source of rewards than a government that is removed from the people. Community incentives programs work because family planning and economic development reinforce each other to increase per capita income.