Just give money? The beauty of cash assistance in emergency response

Why support for cash-based aid grows stronger by the year

9 ways cash can be king in a crisis 

What comes to mind when you think ‘humanitarian aid?’ For many of us, it’s aid workers handing out food and tarpaulins. Or weary recipients hauling bags of grain emblazoned with logos.

There’s no question that material goods like food, water and shelter materials have saved millions of lives over the decades—and still work well in many contexts.

But approaches are shifting. Increasingly, organizations like World Vision are offering families cash, vouchers, money transfers or pre-loaded ATM and credit cards, so people can purchase what they need.

In the past 15 years, the use of cash-based programming among international relief and development agencies has climbed from less than one per cent of all humanitarian response funding to a full 21 per cent.

Families experiencing crisis tell us they prefer financial assistance over other kinds. Research tells us cash-based programs offer choice, flexibility, long-term resilience and human dignity. Here’s more:

9 major benefits of cash-based programming

Provides people with choice, control and flexibility. “Cash allows people to keep their dignity, shopping for their own items instead of lining up at food distributions,” says Elizabeth Araniva, World Vision Canada’s cash transfer adviser.

Supports families’ long-term resilience. When a crisis becomes desperate, families may sell off livestock and farm equipment, or eat crops they’d counted on for income. Cash assistance offers a financial buffer, so people can buy essentials without losing years of progress.

Boosts the local economy. With cash or vouchers in hand, people are encouraged and likely to shop close by. This helps local markets to recover and strengthen and can even lead to new business and employment opportunities, as with Tshanga’s small bakery (top photo.)

It puts spending power in women’s hands. When families receive cash, wives and mothers are often the ones who make the household purchases. “Women tell us, ‘I felt empowered to buy what I needed to buy,’” says Elizabeth. “It gives them a sense of power.”

Allows people to buy fresh foods. For logistical reasons, food distributions only include non-perishables like rice, grains or oil. However, where local markets are functioning, people can use their money for nutritious fresh eggs, meat and produce as well.

Helps people stay safe. Carrying home large quantities of aid supplies can make people—especially women—conspicuous and vulnerable. The ability to receive funds digitally or tuck a voucher out of sight contributes to their overall sense of security.

Allows for remote solutions. Security and environmental risks can prevent the timely distribution of physical goods. So long as people have cell phones—and nearly everyone does—digital cash and voucher transfers can happen fast. Our response in COVID-19 lockdowns was a great example.

Highly cost-effective. Emergency food and supplies can be expensive to transport and store. Supply chains can be unpredictable and sometimes, insecure. But research has shown cash-based programming to be at least 25 per cent more efficient, meaning donors’ dollars can go further.

Promotes justice in societies. About 1.5 million of the world’s adults can’t access the formal banking system. They’re mainly women, people with disabilities, individuals in remote areas, adults with low education, and the financially poor. Vouchers or pre-loaded ATM cards can help.

All in all, cash assistance can pay dividends in helping people, families and communities to their feet, after a disaster has knocked them down. Children receive what they need to survive and even thrive. After all, it’s they who will rebuild their countries one day.