Olive, a Congolese refugee in Rwanda’s Mugombwa camp, on how cash assistance helped her family gain acceptance.

The global refugee crisis may seem intractable, but there are promising, tested interventions to help those displaced. Lump sum cash transfers can provide more than just temporary relief. Our programs suggest direct cash is a scalable response that can change the future for millions of protracted refugees.

The solutions to date haven’t scaled, and we need a new approach

According to the UNHCR, over a quarter of the world’s 26 million refugees are in sub-Saharan Africa, with most fleeing political instability and violence in the Democratic Republic of the Congo (DRC), Burundi, South Sudan, and Somalia.

There are three “solutions” for refugee crises:

  1. repatriation, when conflicts end
  2. resettlement to a third country, when permitted
  3. local integration in the host country

Repatriation is unpredictable as violence often dies off, only to flare up again. Wealthier countries rarely open their doors for resettlement, and last year accepted a record low of just 22,770 people, around the size of just a single refugee camp. That’s why GiveDirectly partners with governments and UNHCR to focus our interventions on the third option: local integration into the host countries. We’ve supported protracted refugees in Uganda and Rwanda and hope to expand to Kenya.

Refugees received just enough to survive; then rations were reduced

The UN World Food Programme (WFP) in partnership with UNHCR provide humanitarian food assistance to vulnerable camp-based refugees in Rwanda to meet their food needs. Food assistance is provided in the form of cash-based transfers to allow refugees to purchase the food of their choice from local markets in and around refugee camps. The value of the cash assistance is based on average market prices for basic food items in Rwanda.

WFP’s refugee operation has faced severe resourcing constraints in 2021 and WFP was forced to reduce food assistance rations to 40 percent in March and April 2021. With thanks to additional donor contributions, WFP was fortunately able to increase the size of the rations from May 2021, though continues to implement ration reductions due to funding constraints. 

Unconditional cash transfers can build self-reliance in refugees

Beyond food assistance, refugees need a boost above the poverty line to truly integrate with their host community and graduate off of assistance. In 2020, we ran a ~$700 lump-sum transfer program in Rwanda’s Mugombwa refugee camp in collaboration with the government and UNHCR. Our evaluation shows signs of success: 80% of recipients paid down predatory debts and 60% used the funds to jump start investments, especially in farming just outside the camp (Figure 1), which provides a plausible path to sustainable self-reliance. Recipients reported higher rates of employment (Figure 2), though we cannot confidently attribute this to the transfers as the evaluation did not include a control group.

Anecdotally, recipients reported that increased household spending helped them integrate into their host communities: Olive said being able to buy better, untattered clothing let her children play with local Rwandan children without immediately standing out as “poor refugees” and gave her an increased sense of dignity. (Video above)

We’ve shown delivering cash in camps is feasible & scalable

Working in a refugee setting requires a unique program design. Here are two highlights of how we adapted our existing programs: 

We enroll & pay the surrounding host communities to smooth refugee integration

Rural refugee camps are often located in the poorest areas of a host country, and locals don’t receive even the $7.72 (or now, $3) a month that those in camps do. Our goal is to assist with integration; we don’t want larger lump sum transfers to create resentment or suspicion between refugees and their neighbors. In most of our refugee projects, including this one, we also enroll a substantial number of non-refugee locals from the host community in our cash transfer program. For our Mugombwa project, we included 5K local households in addition to the 10K refugee ones.

We partner with government to connect these not-quite-citizens to mobile money

Rules vary by country and camp, but no refugee enjoys the same rights as citizens in their host countries. Few are allowed free movement to do business in host communities. In Kenya, refugees are prohibited from registering for mobile phones, so are unable to use the country’s ubiquitous M-PESA mobile money system. In Rwanda, creating a mobile money account requires a refugee ID card, which require complex formalities before obtaining. 

When we first reached the Mugombwa camp, only 37% of households had the refugee ID required to receive mobile money because of missing documents and other errors on their record. We launched a full service help desk with the Rwandan government and UNHCR to address grievances and validate registrations, by the end of our program, 96% of households in the camp had official refugee IDs (which also help them access employment, healthcare, travel, and education). In Kenya, we’re working with financial institutions to provide debit cards to urban refugees to work around the mobile money challenges.

These delivery challenges, while surmountable, do affect our efficiency. Our Mugombwa program delivered 85 cents of every dollar to recipients, five cents lower than our historic average. However, we did beat the 75% program efficiency we’d initially anticipated by 10 points, a promising sign for future improvements.

What role can cash transfers play in building refugee resilience?

In May 2021, WFP with UNHCR in collaboration with the Rwandan Ministry of Emergency Management began needs-based targeting of food assistance for refugees who now receive different ration sizes based on vulnerability. In parallel with this exercise, the Government of Rwanda, UNHCR, WFP and other partners will strive to create more access to livelihoods for refugees to meet their own needs and progressively graduate out of assistance. With record forcible displacements and protracted crises, there’s a growing need for sustainable solutions that graduate refugees to self-reliance. 

Humanitarian assistance alone will not lift refugees above a state of economic dependence. We’ve seen strong directional evidence of the positive impact of one-off, lump sum transfers from our evaluation in Mugombwa and early RCT reports in Kiryandongo. Our field operations are tested and ready to scale, provided funding. Working with the Rwandan government and the UNHCR, we could send $1,000 to every single refugee household in Rwanda – 38,000 – and a portion of their host neighbors with just $73 million. With our partners, we’re equipped to help entire refugee populations begin to build self-sustaining futures and gain a stake in their communities.