Cash and voucher programmes
FAO’s cash-based interventions are tools to provide resources in the form of cash or vouchers to smallholder farmers who are particularly vulnerable to natural hazards, market volatility, conflict and protracted crises. This contributes to protecting and rehabilitating their livelihoods, increasing agricultural productivity and promoting rural development.
Cash and vouchers play a critical role in response to crises or shocks when farmers and pastoralists no longer have the ability to purchase food or productive inputs because their assets were damaged or depleted. They enable people to identify for themselves what their most pressing needs are and to decide which goods and services they wish to purchase in local markets. While providing relief to farmers, FAO’s cash transfer interventions also help them to protect their livelihoods from future shocks (e.g. the rehabilitation of irrigation canals will reduce the impact of future floods and drought), overcome cash shortages and improve their food security and nutrition. More specifically, cash-based programmes are important for:
- Dignity. Cash empowers beneficiaries by allowing them to prioritize their needs as they deem appropriate and address them.
- Accountability and transparency. Cash can be tracked and the provision of vouchers, for instance, reduces risks of misappropriation of funds.
- Food security. Cash increases household expenditures for food and other basic goods thus improving food security and nutrition.
- Agricultural productivity. As a result of cash being used to purchase agricultural inputs and to invest in production, productivity is increased.
- Economic multipliers. The injection of cash in local markets stimulates local economies.
- Cost efficiency. Compared with in-kind assistance, delivery costs for cash are sharply reduced.
- Financial inclusion. Providing cash-based assistance facilitates beneficiaries’ access to markets, financial services and payment systems.
FAO’s cash and vouchers projects
Since the first voucher-based project implemented in Mozambique in 2001, FAO has reached over 10 million people (2.5 million households) with cash and voucher programmes in 46 countries. The map below indicates the cash and voucher projects for 2016‒2017:
Types of cash-based interventions
Depending on the specific objectives and contexts, FAO implements a variety of cash-based interventions as follows:
- Cash transfers: when quality goods are available and local markets are functioning, conditional or unconditional cash transfers provide poor and vulnerable households with the income required to maintain a minimum standard of living.
- Cash+: the provision of cash transfers to beneficiaries is complemented with productive assets and/or technical training.
- Voucher programmes: beneficiaries receive vouchers that can be exchanged for goods and services (i.e. seeds, fertilizer, tools, animal feed, veterinary supplies and services, etc.) at selected shops.
- Cash for work: within the framework of public work schemes (cash-, food- and voucher-for-work activities), beneficiaries are paid in exchange for unskilled labour to rehabilitate degraded lands and community infrastructures (e.g. rehabilitation of irrigation canals and water catchments, tree planting, land recuperation, etc.).
- Input trade fairs: one-day temporary markets where farmers and herders can purchase agricultural inputs and services through the exchange of vouchers.
Overall, FAO’s cash-based interventions can be implemented to support vulnerable populations in emergencies, when (i) markets are functioning, and (ii) basic goods and services are locally available.
Within the framework of the recent World Humanitarian Summit and in line with the Grand Bargain, FAO has committed to: (i) operationalizing the goal of cash-based delivery of assistance as a preferred method, when appropriate; (ii) scaling up programmes and research on cash-based interventions; and (iii) strengthening internal capacities on cash-based programming and implementation.
Capacity building programme
Launched in 2013, FAO’s cash transfer capacity building programme covers: (i) the principles of cash transfer programming; (ii) cash transfers and public work schemes; and (iii) voucher schemes and input trade fairs. To ensure the success of its cash transfer interventions, FAO’s training initiative responds to the needs of its decentralized offices. FAO’s cash transfer interventions are based on the Organization’s wide-ranging technical expertise in areas such as agricultural production, seed security, land management, climate change adaptation and rural development.
FAO Guidelines for Public Works (cash-, voucher- and food- for- work) and Guidelines for Input Trade Fairs and Voucher Schemes provide practical guidance to design and implement selected cash transfer modalities.