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For refugees, the best solution is often just cash

Venezuelans fleeing into Colombia are receiving aid from the IRC in the form of simple cash transfers–and they’re working wonders.

For refugees, the best solution is often just cash
Yoleima del Carmen [Photo: International Rescue Committee]

A little less than a year ago, as the cash crisis in Venezuela kept making it harder to afford food and medicine, Yoleima del Carmen and her family made the move to neighboring Colombia. Her job as a dressmaker and her husband’s job as a mechanic hadn’t been bringing in enough money to pay bills. Her children were eating so little that they were perpetually sick.

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In Colombia, a family member offered them a small piece of land. But like other Venezuelans who have made the same move–nearly a million people, by some estimates, have gone to Colombia over the last four years–they had next to nothing to start their new lives.

[Photo: International Rescue Committee]

A new program offered the family a straightforward form of help: cash for three months. The nonprofit International Rescue Committee, working with local partners, identified the family as being in particular need of assistance, and then gave them transfers of $66 per person each month. Del Carmen invested the money to start a new mini market, so after the three-month program ended, she had a new stream of income.

The situation, the IRC says, is well-suited for cash transfers, a type of program that is becoming increasingly common in humanitarian aid, especially in programs in sub-Saharan Africa (though it was also tested in Houston after Hurricane Harvey). Instead of handing out food or other supplies, the programs let recipients decide the best way to spend money.

“It restores a degree of dignity just by restoring the ability to choose, which is really critical,” says Cortney Newell, who leads the cash program for the IRC in the country. Colombia doesn’t have a shortage of goods to buy, unlike Venezuela, where supermarket shelves are often empty. Handing out donations of food would also disrupt the local market.

[Photo: International Rescue Committee]

Families can spend the cash however they want, though the nonprofit has seen several invest in a small business–buying a sewing machine or supplies to make and sell empanadas, for example. In the first round of cash transfers, which just ended, the majority of families used the money for food and rent, while others used some of the cash for medical expenses. Recipients reported that they felt less stress and were arguing less with family members.

The project is the latest example of IRC’s move to use cash transfers, which it has already started using in other countries, including Afghanistan, Pakistan, Lebanon, and the Philippines. In 2015, the organization was delivering 6% of its humanitarian aid through cash. By the end of 2017, that number was 17.7%. By 2020, it plans to deliver 25% of aid that way, and to have active cash transfer programs in three-quarters of its country offices.

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[Photo: International Rescue Committee]

In Colombia, almost 90% of the families in the first round of cash transfers were eating enough food after becoming part of the program. “That’s staggering, because a lot of times when we first meet families they’re feeding a family of six or seven on a dollar or two a day,” Newell says. The intervention also dramatically reduced what the organization calls “negative coping behaviors,” such as families sending children to beg on city streets. The results are preliminary because the program is new, but “they’re really, really impressive,” she says.

The program has worked with close to 1,000 people since it began a few months ago. Still, that’s a tiny fraction of the people in need. Of the 35,000 Venezuelans who cross the Simon Bolivar Bridge to Colombia every day, around 5,000 people don’t return. Hyperinflation in Venezuela, which reached 83,000% in July, is continuing despite the government’s attempts to slow it. Humanitarian organizations trying to help the wave of migrants are underfunded.

“There’s so much opportunity and there’s people here who want to do the work, and we just need to be able to get the resources to keep scaling up,” says Newell. “This crisis doesn’t really show any signs of abating.”

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About the author

Adele Peters is a staff writer at Fast Company who focuses on solutions to some of the world's largest problems, from climate change to homelessness. Previously, she worked with GOOD, BioLite, and the Sustainable Products and Solutions program at UC Berkeley.

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