Determining the appropriateness of using cash transfer programs (CTP) should ideally be done at preparedness stage to feed into contingency planning and inform future responses. To determine if CTP is appropriate for a specific project, ensure the following:
Community acceptance and needs
a. The targeted community is used to handling cash.
b. The beneficiaries’ needs the project is intended to cover are usually covered through the market(s) (as opposed to household production for example).
c. Crisis affected people prefer cash over in-kind. While this is often the case, it cannot be assumed and thus needs to be assessed. The preference for a certain modality can be influenced by the perceived value of the assistance, market volatility and bias towards the type of aid people are used to receiving.
a. The government (national, regional, and/or local as relevant to your project) is aware of what CTP is, and is accepting of the use of cash transfers.
b. There are no legal restrictions on the use of CTP or certain delivery mechanisms (e.g. mobile money) in the area where you plan on implementing your project.
a. Markets are integrated and able to accommodate the increase in demand (both in terms of quantity and quality of goods and services) the use of CTP will create.
b. The items (food, goods, or otherwise) beneficiaries need to meet their immediate needs are locally available.
c. Markets are physically accessible, safe and do not require significant resources (time or otherwise) to access. This should be true for all of the various factions of the target group (e.g. women, elderly, disabled, minorities, etc.).
d. Prices for key items and services are stable and in line with normal seasonal trends; the assessment does not indicate that prices are on an inflationary trend, and there are no foreseen price increases over the coming months (due to either the project or external factors).
a. Functional and reliable payment systems are available in the location where you will implement your project. This is one of the key conditions of CTP appropriateness. Financial service providers often refer to traditional financial institutions such as banks, microfinance institutions (MFI), and/or post offices, as well as more informal payment service providers such as traders, hawala, and local organisations.
b. The payment agents or mechanisms are accessible to all targeted beneficiaries. This includes financial access (i.e. the costs to physically access the payment agent), physical access (ability and time to access the agent), and social access (i.e. men, women, elderly, people living with disabilities, children-headed households can access the payment agent).
c. If using mobile phones, the network coverage exists and is reliable.
d. Community members have the documents they need to access the payment system; they meet the Know Your Customer regulations (e.g. identification documentation, etc.).
a. Cash transfers can be delivered safely and effectively. This includes considering the safety of the beneficiaries, but also the project implementation staff ... (plus)
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