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Briefing: Making cash work for cities and towns affected by humanitarian crises - March 2016

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Cash transfers can offer value-for-money in humanitarian responses, and cash transfer programming (CTP) has the potential to transform humanitarian architecture. While this type of assistance is established — in 2015 the EU Humanitarian Aid and Civil Protection Department issued ‘10 common principles’1 for use of cash — to date it has mostly been used in rural areas. As humanitarian agencies increasingly face emergencies in urban settings, what can CTP contribute and what challenges arise? An IIED literature review2 indicates that cash transfers have a role in the first phase of urban humanitarian response and could contribute to longer-term development objectives. If humanitarian CTP in urban contexts is to be effective and sustainable it requires cooperation, coordination, capacity and commitment. It needs funding that is distributed across key humanitarian, development and private-sector stakeholders, under the leadership of a strategic and accountable body.

Accurate and context-specific response analysis is crucial to humanitarian programme design. However, evidence suggests that an early assumption can be made even as the facts are gathered: cash transfers can and should be prioritised to support populations hit by urban disasters, whether these are rapid, slow onset, or protracted crises. CTP has the great benefit of being a ‘multi-sectoral’ response: it can ensure beneficiaries are able to satisfy a wide array of ongoing needs, such as education, housing and health, which might be compartmentalised by traditional humanitarian responses. The transferable nature of cash also enables households themselves to prioritise their needs. At the same time, locally-spent cash is contributing to market recovery and helping to re-establish livelihoods (see Box 1).

A recognition of the advantages of cash has led to the creation of ‘multipurpose grants’ (MPGs)3 in recent urban emergencies, including the Syrian refugee response. MPGs are a critical instrument for effective urban cash assistance, considered appropriate when several humanitarian objectives (such as improved food security, shelter and access to basic hygiene items such as nappies and soap) can be fulfilled through one single transfer.4 This is often the case in urban settings, where demand is complex and interconnected, and where populations are dynamic in movement, making the traditional single-sector approach both ineffective and impractical.5 Programmes designed to meet beneficiaries’ diverse economic needs in one single transfer are able to contribute to overall wellbeing and resilience, rather than producing specific outcomes in a particular sector.