GiveDirectly to Pilot Ten-Year Cash Transfer Program in Kenya

GiveDirectly, a U.S.-based charity that gives cash to those living in extreme poverty in the developing world, is piloting a program to provide a guaranteed basic income over ten years to six thousand Kenyans, the Thomson Reuters Foundation reports.

Slated to start at the end of the year and estimated to cost $30 million, the project will provide between $0.70 and $1.10 per person per day through mobile money transfers to recipients who currently live on about $0.65 a day, said GiveDirectly co-founder Michael Faye. The program — the first long-term cash transfer project of its kind — will be run as a randomized controlled trial, with randomly selected poor villages receiving cash transfers for at least a decade, while other villages do not. Faye said that another ten thousand Kenyans will receive some form of cash transfer as well. Since 2011, GiveDirectly has provided short-term cash transfers to people living in extreme poverty in Kenya and Uganda and plans to begin operations in Rwanda soon.

While cash transfers account for only about 6 percent of humanitarian aid, studies have linked them to significant improvements in school attendance and access to health care. Recipients also tend to save or invest some of the money, which promotes income generation instead of reliance on food aid. The World Food Programme recently provided digital cash cards to displaced families in Iraq, giving them a choice to redeem the cards for cash or food, while in Kenya's drought-stricken North Eastern province, the government routinely transfers cash to the most vulnerable residents.

"Whether it's trying to assist them out of poverty, or in times of crisis and disaster, we need more tools on the table, and cash transfers can be particularly effective at enabling flexibility and choice," said Sarah Bailey, a researcher at the Overseas Development Institute. Still, some charities and donors remain reluctant to use cash transfers, she noted, because it "takes a tiny bit of power away from the giver....Some charities have obviously embraced this...but it's still a smaller proportion compared to other ways of helping."

"At its core, it puts trust in the poor," said Faye, "and the poor have a pretty good track record to have earned this trust."