Momentum Builds for Use of Cash Transfers in Humanitarian Aid Programs

Cash transfer is part of a social security program in northeastern Kenya. Photo by: Colin Crowley / CC BY

It has been argued before: Humanitarian agencies need to rethink their strategies in conflict-torn and highly insecure countries to identify new and more efficient ways of delivering aid to beneficiaries. One new approach that is increasingly finding its way in aid groups’ programming is the use of cash transfers or vouchers.

Humanitarian agencies have traditionally, and continue to, provide the bulk of their assistance as food, shelter materials and other in-kind aid. Delivery of these supplies, however, is a challenge in conflict-torn and highly volatile states such as Somalia.

Cash transfer programming is one way the World Food Program and non-governmental organizations such as Oxfam International and Horn Relief are responding to this challenge, particularly in southern parts of Somalia that are largely inaccessible to aid groups because of security concerns. And, as IRIN notes, the use of cash transfers or vouchers is becoming a critical complement and even alternative to the delivery of in-kind aid.

Why cash? Degan Ali of Horn Relief explains “cash is less visible, more dignified, uses fewer intermediaries, is in transit for less time and a more flexible resource to meet needs beyond food.”

Still, there are a number of challenges to the integration of cash in humanitarian aid programs, including inflation and the fact that radical changes to the way humanitarian aid is provided are not likely to materialize any time soon.

On inflation, advocates of cash transfers and vouchers have noted that “it’s all about good programming.” Implementing agencies just need to carefully examine whether the introduction of cash in a particular community would result to inflation. It is “all context-specific,” Breanna Ridsel of the Cash Learning Partnership said, according to IRIN.

Reluctance among aid agencies to fully adopt this approach is a bigger challenge, the advocates admit.

“The momentum is building but any change happens slowly, any adoption of new techniques meets resistance at first, it has to go through the process of building evidence, proving itself, making mistakes, correcting itself and building systems; this is the biggest obstacle to adoption at scale,” Ridsdel said.

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About the author

  • Ivy Mungcal

    As former senior staff writer, Ivy Mungcal contributed to several Devex publications. Her focus is on breaking news, and in particular on global aid reform and trends in the United States, Europe, the Caribbean, and the Americas. Before joining Devex in 2009, Ivy produced specialized content for U.S. and U.K.-based business websites.