Cost-effectiveness in humanitarian work: cash-based programming

Cash generates cost efficiency gains in the humanitarian system. There is consensus in the literature that giving people cash in humanitarian contexts provides greater choice and dignity while at the same time stimulating local markets. In comparison to in-kind approaches, cash emerges as more efficient to deliver and – depending on the particularities of a given context – it can also be equally or at times more effective at delivering the desired outcomes when compared to in-kind assistance and vouchers. The evidence presented in this literature review demonstrates that cash based responses are value for money with respect to improving humanitarian outcomes and reducing the cost of the response. In particular, unconditional cash transfers allow people to buy the goods and services they need through local markets and are also characterised by flexibility that would be hard to match through in-kind responses (ECHO, 2016); flexibility is important because evidence shows that programme beneficiaries exhibit a wide set of needs, which translate into unique expenditure patterns (UNICEF, 2017).