The Future of Cash Based Assistance
Press Release
Why:
The International Disaster Database records a steady increase in the frequency of natural disasters over the past 35 years. In the past 10 years, the number of people affected by humanitarian crises have almost doubled, whilst the cost of humanitarian assistance has tripled. For this reason, the humanitarian world is undergoing a transformation in the way that aid is delivered. This transformation must not compromise the humanitarian principles of impartiality, neutrality and independence.
Assistance must always reach the most vulnerable. An effective way to support people affected by natural disasters is through a combination of CBA and FBF*. FBF allows for both decision-makers and people affected to better prepare for and cope with natural disasters and thus reducing needs when disaster strikes. CBA offers a more efficient and dignified means to deliver assistance, empowers people in need and fosters local economies.
*Forecast-based Financing: FbF enables access to funding for preparedness & early action for response based on in-depth forecast and risk analysis. It reduces losses and damage in terms of lives and resources and it is more cost effective than spending on risk and recovery. It is recognised that data and data modelling, the strength of 510, is a crucial component of an FbF system.
CURRENT CHALLENGES:
However, these CBA programs face multiple challenges. Every disaster type and local context has its unique set of challenges and in turn a unique set of solutions. The scope of the current solutions differ dramatically from high digital connectivity, to that of low or no connectivity. For this reason we started with a common set of parameters that we want to improve on. These can be clustered as:
TIME: Depending on the location, getting cash-based assistance to the most vulnerable can be a slow process. We aim for a system to trigger fund release from anything up to 6 days to 24 hours before a natural disaster strikes (for early warning and early action).
SAFETY: Both Red Cross field staff & volunteers, and the recipients of assistance, are vulnerable due to large amounts of physical cash.
COSTS: International bank transfers, hiring security and in-country logistical challenges creates high costs.
INCLUSIVENESS: Beneficiaries do not always have a proof of identity and are therefore not easily included in humanitarian aid across various humanitarian organizations.
SCALABILITY: Current solutions differ dramatically in each context.
WHO:
510 together with Tykn.tech are exploring the potential of humanitarian aid integrating blockchain in current humanitarian operations.
HOW:
We gathered both teams to meet with a diverse group, including experienced Red Cross cash delegates, system engineers, econometricians and social scientists. Through numerous sessions, we established the current and potential user journeys for all stakeholders. Highlighting challenges of beneficiary registration due to a lack of proof of identity. Incorporating the knowledge of a 150 years of providing humanitarian aid, we look at the social & economic factors that affect the potential technological applications and algorithms that can help identify and ultimately reach the most vulnerable.
WHEN:
The project will conduct a pilot integration in at least one of the current Red Cross operations during 2018.
WHERE:
The ultimate goal is to develop a system that can adapt to any type of disaster in any location. In the interest of scalability, we are exploring two very different local contexts. One with high digital connectivity as with St Maarten, and one with low to no connectivity such as the most vulnerable areas of Malawi.
