Opinion: Look to retail techniques to support humanitarian cash programs

Mesfin Gebreyonas Getahun, an Ethiopian refugee who has lived in the Kakuma camp in Kenya for some 20 years, in his shop. Photo by: WFP

Walking through the market in Kakuma in northwest Kenya, one would not think it is a refugee camp. The stalls and small retail shops are well supplied with fresh fruit, vegetables, dried fish, and all kinds of groceries. The atmosphere is lively and cheerful with customers discussing prices and exchanging news and gossip. It could be anywhere in the world — but it is one of the largest and oldest refugee camps in Kenya with a population of nearly 200,000 from neighboring countries.

Since it was set up some 50 years ago, Kakuma has grown into a town of its own, with similar commercial activities to any urban context. Long-term refugees run small retail activities, where supplies tend to be irregular, if not sporadic. So, when the World Food Programme began to distribute cash, it had to address the issue of market supply to ensure that people could purchase all the essential goods they needed at the right price. It was like entering a new world — that of commercial enterprise.

WFP responded to the challenge by hiring specialists from the retail sector who were able to transfer their knowledge to a humanitarian context. With their support, a so-called retail initiative was introduced to improve the supply and prices of goods available in the camp’s stores.

That meant working closely with small traders to streamline their supply chain, help them plan forthcoming demand, and negotiate wholesale prices. In addition, prices were regularly monitored to avoid inflation. Over a year later, the impact has been positive for the refugees, who can buy a wider range of goods at a better price, and for local retailers, who have seen their businesses expand.

In Kakuma camp and the nearby Kalobeyei settlement, WFP has contracted 250 small-scale traders — both refugees and local Turkana community members — to operate as official traders in its “Bamba Chakula” cash program, ensuring they are licensed, registered, and, for those handling fresh foods, have medical certification.

Traders have been trained to conduct cash transactions, which are paid to the beneficiaries’ mobile phone through Safaricom’s Sure Pay platform. In addition, they undergo regular performance evaluations to ensure they are adhering to their contract terms.

For refugees, it is a step up. They can become active participants in the program and eventually generate their own income and provide for themselves.

Mesfin Gebreyonas Getahun, an Ethiopian refugee who has lived in the camp for some 20 years, is one of the traders enrolled in WFP’s retail engagement initiative. He owns a shop named Jesus is Lord in the camp’s so-called Ethiopian market, the area where most long-term Ethiopian refugees congregate. Through this initiative, he has been able to expand his shop and better supply it, sell to more customers, and improve his livelihood.

“My life is good now. I am married, I have good business. I am blessed,” he says.

He is also one of the preferred wholesalers identified by WFP to supply smaller retailers in Kakuma and Kalobeyei, and he is being encouraged to act as a mentor for them.  

Jackline Nekesa Wafula, a host community contracted trader in Kalobeyei settlement. Photo by: WFP

One of the known benefits of humanitarian cash programs is the multiplier effect in local economies. In both locations, the local Turkana communities have benefited from the new shops both as traders and consumers.

In Kalobeyei alone, half of the contracted retailers are now from the host community. They supply fresh fruit and vegetables, dry goods, and other food products sourced locally or from regional farms and markets. They also have access to a greater variety of fresh produce and essential goods for themselves.

“Before the Bamba Chakula program, there were no shops in the area. We couldn’t buy any of the goods available now,” said Jackline Nekesa Wafula, a host community contracted trader in Kalobeyei settlement. She has five people working for her, including three refugees.

“They help me translate from Arabic, [since] many of our customers speak that language. At first, we were a little wary of refugees, but now we are friends,” she added. She has also benefited from WFP business training to help her draft contracts and negotiate better.

As a result, the shops are better supplied at a lower price. That translates into greater purchasing power for the beneficiaries and improved diet from a wider diversity of fresh food.

Overall, the living conditions of both the refugees and the local communities have improved. In the past decade, WFP increased its cash portfolio from $10 million in 2010 to $1.74 billion in 2018, now representing one-third of overall assistance.

The views in this opinion piece do not necessarily reflect Devex's editorial views.

About the author

  • Channon Hachandi

    Channon Hachandi is the head of WFP’s cash-based transfers unit of supply chain, based in the organization’s headquarters in Rome. He joined WFP in 2002 in Zambia and has since worked in various functions in supply chain in Pakistan, Afghanistan, Jordan, and Egypt. Prior to WFP, Channon worked for a commercial logistics company in Zambia. He holds a master's degree in operations and supply chain management, and an accounting degree.