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Cash transfer
A cash transfer is a direct transfer payment of money to an eligible person. Cash transfers are either unconditional cash transfers or conditional cash transfers. They may be provided by organisations funded by private donors, or a local or regional government.
Cash transfers constitute a critical element in the realm of global social policy, addressing needs ranging from poverty alleviation to crisis response.
Cash transfer programs can be classified into humanitarian cash transfers, which address urgent needs in crisis situations guided by humanitarian principles, and social assistance cash transfers that form a key component of ongoing welfare policies and systems.
Humanitarian cash transfers provide life-saving humanitarian aid in emergencies like natural disasters, conflicts, and famines, focusing on short-term, immediate relief.
As of 2015, only approximately 6% of humanitarian aid is provided in the form of cash transfers and vouchers. Evidence indicates that it is more cost-effective, better for recipients and more transparent than in-kind aid.
Social assistance cash transfers are part of broader social protection systems aimed at reducing long-term poverty and vulnerability. These transfers target various demographic groups, including the unemployed, single parents, and individuals facing disabilities or old age challenges.
Cash transfer programs may be provided to recipients based on means testing, random-sampling mechanism or through universal provision.
Means testing potential recipients of cash transfers is the more politically acceptable, as money is not perceived to be wasted by including those who do not have a desperate need for the money ("leakage"). This can either be achieved through a screening process of potential recipients, or else by making the benefits of the transfers so low only the most desperate will apply. Yet there are also many problems associated with this method as the transaction costs of screening are very high, due to the need to pay for assessment, the travelling cost of candidates to and from the assessment and also the potential risks for corruption. There also may be a negative effect on social capital as resentment develops of those who receive support by those who do not.
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Cash transfer
A cash transfer is a direct transfer payment of money to an eligible person. Cash transfers are either unconditional cash transfers or conditional cash transfers. They may be provided by organisations funded by private donors, or a local or regional government.
Cash transfers constitute a critical element in the realm of global social policy, addressing needs ranging from poverty alleviation to crisis response.
Cash transfer programs can be classified into humanitarian cash transfers, which address urgent needs in crisis situations guided by humanitarian principles, and social assistance cash transfers that form a key component of ongoing welfare policies and systems.
Humanitarian cash transfers provide life-saving humanitarian aid in emergencies like natural disasters, conflicts, and famines, focusing on short-term, immediate relief.
As of 2015, only approximately 6% of humanitarian aid is provided in the form of cash transfers and vouchers. Evidence indicates that it is more cost-effective, better for recipients and more transparent than in-kind aid.
Social assistance cash transfers are part of broader social protection systems aimed at reducing long-term poverty and vulnerability. These transfers target various demographic groups, including the unemployed, single parents, and individuals facing disabilities or old age challenges.
Cash transfer programs may be provided to recipients based on means testing, random-sampling mechanism or through universal provision.
Means testing potential recipients of cash transfers is the more politically acceptable, as money is not perceived to be wasted by including those who do not have a desperate need for the money ("leakage"). This can either be achieved through a screening process of potential recipients, or else by making the benefits of the transfers so low only the most desperate will apply. Yet there are also many problems associated with this method as the transaction costs of screening are very high, due to the need to pay for assessment, the travelling cost of candidates to and from the assessment and also the potential risks for corruption. There also may be a negative effect on social capital as resentment develops of those who receive support by those who do not.