This Guidance Note provides DFID staff with an overview of key components of cash transfer programming (CTP) in emergencies, including operational conditions required to assess its feasibility & effectiveness.
There is a significant and growing body of experience demonstrating that cash-based interventions can act as an alternative or complement to in-kind assistance, although they still make up only a fraction of overall humanitarian assistance. Cash transfers are not a sector in their own right but a tool that can be used – when appropriate – to meet different objectives, including improved health and nutrition outcomes, as well as support to livelihoods. It has the potential to be cheaper, aid local recovery and help limit commodity-led responses, which can distort local economies. Humanitarian agencies are increasingly incorporating cash transfers within their disaster response tool-box to deliver multi-sector objectives, and respond to different types of emergencies including: seasonal disasters, protracted crises, rapid-onset disasters and slow-onset chronic disasters.
Factors to be considered when deciding on use of CTP include:
- Intervention objective clearly identified and can be feasibly met using CTP
- Needs can be met though the market with readily available commodities or services at the required quality, quantity and frequency for the given project duration
- Cash is used in the operational context and beneficiaries are open to receiving CTP
- Access to functioning, competitive and integrated markets or options to support market recovery are present
- Agreement on targeting and safe receipt of resources, including analysis of local gender dynamics
- Assessment and selection of cash delivery mechanisms (mobile operatives, financial institutions) against clear criteria including: security, cost and scale up capacity
- Position of National and local Governments
- Security risks of cash are compared to other approaches and it is determined that risks to beneficiaries, agencies and any third parties can be managed
- Humanitarian Agency (and implementation partner) has sufficient organisational capacity & systems to deliver project – to involve logistics, finance and legal advice as needed
- Inclusion of CTP within the coordination system (e.g. IASC cluster system and/or Government-led coordination mechanisms) – including knowledge of aggregate input/impact
- Accountability, monitoring and evaluation systems in place to demonstrate continued appropriateness of the cash intervention and implementation methods used
