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In Zambia, regular social cash transfers play a direct role in reducing poverty

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Marcelina Ngandu (left) and Sylvia Banda (right) both regularly receive cash through the Social Cash Transfer Program. © Carlyn Hambuba/World Bank

STORY HIGHLIGHTS

  • More than 616,000 households or 3 million people, representing 20% of the Zambian population, are currently registered to receive Social Cash Transfers

  • In 2020, the World Bank, UK and Swedish Governments provided financing to the Social Cash Transfer program benefiting 370,000 households in 67 districts

  • A maximum of 994,000 beneficiaries in 116 districts are expected to be reached with Social Cash Transfers by 2022 with support of the World Bank and cooperating partners

LUSAKA, May 27, 2021—Sylvia Banda, 65, uses the monthly cash transfer she receives from the government to take care of her husband who is disabled, and four orphaned children. Africa Zulu, 70, pays his grandchildren’s school fees to ensure they have a better future. Marcelina Ngandu, a widowed mother of five, invests the cash transfer into her small business.

“I buy baking flour and make doughnuts for selling,” said Ngandu, who is also raising her late sister’s five children. “From my last bi-monthly payment of K300 ($14), I made doughnuts and sold them for K400 that helps me pay for school fees for the orphaned children I look after. I urge all other widows to not only eat the money but grow it like I do.”

Through the Social Cash Transfer Program (SCT), supported by the World Bank through the Girl’s Education and Women Empowerment and Livelihood Project, is helping the Zambian government address one of its most important development challenges: poverty.

Sixty percent of Zambia’s population, estimated at about 17.9 million, lives below the poverty line, and the levels of poverty in rural areas tend to be very high. The Zambia Demographic Health Survey of 2017/18 reveals that women headed households are more affected by poverty.

With financing provided by the World Bank, the United Kingdom and Sweden, more than 370,000 households are now receiving regular cash transfers. A recent World Bank simulation indicates that if regular social cash transfers are provided to all current SCT beneficiaries, poverty in Zambia will reduce by six percentage points in 2021.

“Providing cash directly in the hands of poor people has a proven impact in reducing poverty and increasing human capital,” said Emma Wadie Hobson, World Bank Task Team Leader for the Project.

The latest evaluation of the SCT program, which aims to reduce extreme poverty and eradicate intergenerational poverty in the covered households, showed an increase in human capital and productivity. Households were found to have increased the land they operate by 18%, maize production increased by 8% and their livestock by 21%. Households also increased the material needs of children (clothes, shoes, blankets) being met by 30% and increased the number of children attending primary school by 10%.

Through the Ministry of Community Development and Social Services, the government has been implementing the SCT Program since 2003, and the World Bank Board has recently approved a second additional financing which will expand coverage to a total of 750,000 households in 2021 and 994,000 households by 2022. This support will enable timely and predictable disbursements of cash transfers to 30% of the Zambian population and 50% of the country’s poor citizens by 2022. The program is also in line with the government’s Seventh National Development Plan vision of “accelerating development efforts towards Vision 2030 without leaving anyone behind.”