Secondary Impact Of WFP Palestine Cash-Based Transfers-Voucher

The United Nations’ World Food Programme (WFP) has been implementing a Cash-Based Transfer (CBT)/Voucher modality, hereafter the Voucher or Voucher modality, in the West Bank and Gaza Strip since 2009. The Voucher targets non-refugee, food-insecure, and poor households through a system of value-based vouchers that are redeemable through a network of local shops registered by WFP. The Voucher is currently implemented in partnership with the Ministry of Social Development (MoSD) in the West Bank and Gaza Strip and Global Communities (an international NGO) in the Gaza Strip.

The Voucher modality has evolved quickly from being a small food assistance pilot designed to respond to the sharp increase in food prices through paper-based food vouchers, to becoming one of WFP’s flagship cash-based transfer assistance modalities in Palestine. In addition to improving targeted households’ food security by improving food consumption and reducing household expenditures allocated for food, the Voucher modality is intended to have a positive secondary economic impact on the local economy. The first objective is pursued by earmarking its cash-based transfers for foods typically consumed by Palestinian households. The second objective is pursued by restricting foods redeemable through the voucher to locally produced/processed varieties whenever possible and limiting redeemable animal protein-rich foods (namely, eggs and dairy products) to locally produced or processed items.

At the onset of the Voucher in 2009 and 2010, as much as 60% of the value redeemed by beneficiaries was for dairy products and the secondary impact on dairy producers was evidently substantial. As more food items were added to the list of eligible commodities for redemption over the years, and limitations initially imposed on redeemable foods were removed, this percentage in 2021 dropped to 7.7%.  WFP switched from traditional paper-based vouchers to electronic vouchers in 2011. This was done in partnership with Offtec, a local company that had developed an electronic payment system that uses terminals and magnetic card technology. In mid-2015, leveraging the existing infrastructure that WFP had helped establish, the Voucher moved to use the latest payment technology system developed in Palestine, PalPay, to manage the Voucher. The move to the electronic voucher system not only enabled WFP to enhance real-time monitoring of assistance being provided through the voucher, but it also better positioned it to serve other organizations wishing to deliver and monitor cash-based transfers to poor and vulnerable households in need.

In 2014, UNRWA started using the WFP’s voucher platform to deliver assistance to more than 48,300 beneficiaries (7,700 households) in the West Bank. Leveraging this experience, WFP expanded its capacity to facilitate and manage the delivery of humanitarian assistance provided by other actors through the voucher platform. Between 2014 and 2021, WFP’s voucher modality was used by UNICEF, UNRWA, UNFPA, UNSCO, Action Against Hunger, Global Communities, Mercy Corps, Terre des homes, and Islamic Relief to deliver both food and non-food items to various beneficiary groups in the West Bank and Gaza.

WFP’s caseload under the Voucher has increased from 174,346 beneficiaries in 2016 to 366,438 beneficiaries in 2021, of whom 86,525 beneficiaries were in the West Bank and the remaining 279,913 beneficiaries were in the Gaza Strip. Beneficiary households receive one magnetic-strip powered card that gets electronically credited with an equivalent of NIS 35 (US$ 10.3) per person per month. Households can then redeem their cards in any WFP contracted shop. In December 2021 beneficiaries could redeem their vouchers through a network of 265 local shops (76 in the West Bank and 189 in the Gaza Strip).