The type and precise design of the transfer chosen by WFP is dependent on the situation. WFP uses direct cash transfers to people in need of food assistance, for example through direct cash payments, bank transfers, use of smart cards or e-money using mobile phone technology, as well as voucher based assistance. The latter allow people receiving assistance to exchange paper or electronic “tokens” for food in designated shops which are then reimbursed by WFP or its partners. Depending of the design of assistance, vouchers can be exchanged for fixed quantities of specified foods or the persons receiving assistance can select from a range of foods up to a certain cash value. As with food transfers, C&V transfers can be connected to requirements such as participation in work or training programmes.
Advantages of Cash and Voucher Based Activities
Used appropriately, cash and voucher based assistance offer some unique advantages to both the people using them and WFP. Those can include:
• Addressing the cause of hunger: when hunger originates from the lack of financial resources to access food in the market place where it is available, C&V can directly alleviate this economic access restrictions.
• Cost efficient: In some cases C&V are more efficient than providing food directly, as food transportation costs can be substantial.
• Greater Choice: People receiving assistance have greater choice and can also buy fresh food such as eggs, cheese or milk, which are not part of WFP’s traditional food rations.
• “Food plus effect”: In addition to meeting the needs of the people requiring food assistance, the local economy or host population benefit from the injection of cash, especially when vouchers are exchanged for locally produced food. This can help economic recovery after a severe crisis.
• Faster response time: The use of C&V may eventually allow a faster response: for instance, when direct transfer of food to affected areas is hindered by logistical or security reasons.
• National Capacity Building: C&V can be integrated as part of broader social protections and safety net systems, allowing WFP to support national food security strategies.
• Mitigating unintended effects of food transfers: C&V can be used to avoid the assistance recipients sell WFP food to purchase other needed items.
• Hand-over strategy: In some cases it may be easier to develop cash and voucher based programmes with national authorities and then hand them over.
However, it should not be forgotten that C&V are a mere mean (a transfer modality) to an end (the delivery of food assistance, e.g. in exchange for participation in a training programme