New Evidence Shows How to Stretch Humanitarian Funding and Maximize the Value of Cash Transfers
At a moment when humanitarian funding is under unprecedented strain, the Dioptra Consortium has released compelling new research that shows how the aid sector can provide more value to more people with limited resources by applying cost-efficiency findings to cash transfer programs.
The new study, Stretching aid funds: Maximizing the value of multipurpose cash assistance, draws from 79 cost-efficiency analyses of unconditional cash for basic needs (also known as multipurpose cash assistance) implemented by non-governmental organizations (NGOs) in 29 countries. The findings demonstrate that delivering cash at scale is significantly more efficient, revealing a clear path for donors and implementing organizations to maximize the value of every dollar spent.
Key findings include:
Cash is highly effective in meeting people’s basic needs and remains one of the most efficient ways to deliver aid at a median cost of 68 cents to deliver every $1 of cash.
Unconditional cash for basic needs can deliver the most value per donor dollar when implemented at scale. Larger program scale is associated with better cost-efficiency and lower delivery costs for every $1 of cash transferred.
Larger program scale can be achieved by: larger program size, more household cash, more months of cash.
The Dioptra Consortium is calling on donors and implementers to increase program scale when designing and funding cash transfer programs to maximize cost-efficiency.
Provide larger funding envelopes for basic needs cash to reach as many households in need as possible.
Another way to reach as many households as possible could be to coordinate and consolidate cash programs, for example through consortia models and/or unified delivery platforms.
Provide larger multipurpose cash transfer values to cover a larger proportion of basic needs for each recipient household, rather than providing partial transfer values or splitting the transfer value across multiple implementers.
Provide multiple months’ worth of cash within each project that is sufficient for each household to meet their basic needs, whether as single or multiple transfers.
Prioritize and scale up funding for the people most in need who are often in the hardest to reach settings and high-risk contexts.
Cost-Efficiency Data Set: Unconditional Cash for Basic Needs (MPCA)
This new research builds on the Dioptra Consortium’s mission to make cost-efficiency data widely available and actionable across the aid sector. Using tools such as Dioptra to conduct cost analysis can help to improve the value for money of program interventions.
The Dioptra Consortium includes Acción Contra el Hambre, CARE, Catholic Relief Services, Danish Refugee Council, International Rescue Committee, Mercy Corps, and Save the Children. For any questions or more information, please contact: www.dioptratool.org/contact-us