We’re delivering cash to families impacted by COVID-19 in the U.S.
We’re responding to this crisis by doing what we’ve done for a decade: delivering cash. Each household will receive $1k, and we expect the main constraint on how many we can reach will be how much we can raise.
We also plan to respond internationally, and are finalizing those details. Will share shortly.
We’re beginning by targeting vulnerable households enrolled in SNAP, living in the areas hardest hit by COVID-19.
In partnership with Propel, we’re able to identify vulnerable households on SNAP, most of whom are single mothers. We’ll begin by enrolling 200 households to receive the first payments and then expand, focusing on other populations in need who could be missed or underserved by other programs. We’ll update payment size and structure as we learn more about the need.
We’re doing this because we believe …
1. Cash is the right instrument.
You won’t be surprised to hear that from us, but to recap a decade of evidence and experience: it is fast, efficient, effective, and can have multiplier effects on the economy.
2. The government response will likely not be enough.
We’re glad that the government is considering direct cash payments, but even if it does as we hope, we expect there will be delays and not enough money fast enough to the most vulnerable.
3. We can execute well.
We’ve been giving cash since 2008, and have delivered over $150M to poor people in situations as diverse as Liberia, DRC during Ebola, urban Nairobi, and Puerto Rico after Hurricane Maria. When we’ve responded selectively to US crises in the past, we’ve seen positive results both in terms of immediate impact and longer-term interest in giving internationally.
+Is my donation tax-deductible?
Yes, donations are tax-deductible in the United States. GiveDirectly is a registered 501(c)(3), and our U.S. federal EIN is 27-1661997.
+I’m an existing GiveDirectly donor – will any of my donations go to COVID-19?
No. Only donations specifically marked for COVID-19 relief at point of donation will be delivered to recipients affected by COVID-19. Donations marked for our poverty alleviation programs (or those marked “no preference”) will not be used in emergency relief efforts.
+How much of my donation does a recipient receive?
In our previous emergency/disaster relief pilots, over 90 cents of every dollar donated was delivered to recipients. The remainder was spent on key aspects of our operations: identifying the recipients most in need, preventing fraud, and ensuring a high bar of customer service.
+How do I know recipients will spend cash appropriately?
The research is clear: households living in poverty are some of the most effective spenders around. Despite the stereotypes, recipients of cash do not systematically waste or misuse it. Common concerns that people will spend money on vices have been consistently disproven
(Evans and Popova, 2016). To learn more about how recipients in GiveDirectly’s disaster response programs spent their funds, see our published whitepaper here
. In an emergency context, needs can vary greatly. Cash empowers recipients to spend on what they need most. A good question to ask: if your household was hit by an emergency or disaster and someone gave you $1,000, how would you spend the money? Having said that –– we don’t know that every recipient will spend the way the donor thinks best. By giving cash, donors entrust recipients to best define their own needs.
+Can I sign up to be a recipient?
Unfortunately, GiveDirectly is not able to respond to individual requests for cash transfers. In order to ensure fairness and equity in our processes, we only select recipients using our eligibility process detailed above.
+How do you decide who receives money?
Our top priority right now is moving quickly to get cash to vulnerable families. To start, we plan to target families in the U.S. receiving SNAP benefits in areas impacted by COVID-19. Through our partnership with Propel
we plan to begin a first set of payments within days of launch. In parallel, we’re building pipes to reach additional vulnerable populations in the U.S. and beyond, including those who might otherwise be overlooked or are at a critical juncture (e.g. DACA, recent job loss, elderly). Further, we are finalizing our international response plan and will share details shortly.
+Can I choose to whom to give?
No; you cannot choose an individual recipient. Practically speaking, if we did the latter we would risk being regulated as a money transfer service and losing our charitable status. Philosophically, we aim to target the poorest possible recipients in high impact areas of COVID-19, and not those with compelling profiles or narratives.
+How do you prevent fraud?
We use a mix of prevention, detection, and auditing techniques to manage fraud. These include, for example, defined staff roles, spot checks of data captured in the field, remote GPS coordinate checks, and independent follow-up calls with recipients, among others. We use government-issued IDs, utility bills, and other documents to confirm the recipients' place of residence.
+Do you implement the program yourself or partner with other organizations?
We manage the full transfer process, end-to-end. We partner with other organizations to improve our technology and data but our team directly manages each stage of the transfer process.
+Who is Propel?
builds modern, respectful, and effective technology that helps low-income Americans improve their financial lives. They are the creators of Fresh EBT, a free app used by over 2 million Americans across the country to manage their food stamp (SNAP) benefits. A study by Harvard economists showed that using Fresh EBT helped stretch food stamps by an average of two days per month. Fresh EBT aims to support low-income Americans throughout their financial lives, helping them save money and find ways to earn extra income. Propel is a mission-driven for-profit company, with support from investors like Andreessen Horowitz, Kleiner Perkins, Flourish, Kevin Durant, and Serena Williams. Propel has been featured in the New York Times, Wall Street Journal, and WIRED Magazine and was named a winner of the NYTimes’ Good Tech Award in 2019.
Emergency cash response at GiveDirectly
+Who is GiveDirectly?
GiveDirectly is a nonprofit with 10 years of experience delivering over $150 million across six countries. In 2017, our team ran two disaster relief pilot programs in response to Hurricanes Harvey and Maria. To learn more about this work, see our published whitepaper here: here
+What’s the evidence base on cash?
Over 165 studies on cash have shown impact across a range of outcomes. Learn more on our research page
+How much of emergency relief funding is distributed as cash today?
There is room to grow the use of cash in humanitarian aid, which includes emergency and disaster relief. In 2016, the Global Public Policy Institute estimated
that if cash were used wherever the evidence suggests it should be, it would account for 40% of humanitarian aid, four-times its current share (Steets et al, GPPI, 2016).
+Will you be responding to future emergencies and disasters?
That's our goal. We're currently building both operational and fundraising capabilities around a range of humanitarian scenarios, including natural disasters, conflict, and refugee responses. Our decision on whether to deploy for a given disaster depends on the severity of the disaster, the number of low-income households impacted, and our ability to fundraise for relief efforts.