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Digital Payments and New Technologies in CTP

Why is this theme important?

Digital technology is transforming the way in which the humanitarian sector responds to emergencies. Digital payments, when used appropriately, can help ensure that those affected by crisis receive cash assistance in a way that is timelier, more reliable, secure, cost effective and inclusive. The scale-up and reach of partnerships between the humanitarian sector and digital payment service providers have been key to the scale-up of CTP, and will continue to be as set out in Global Objective #6 of the Global Framework for Action: Strengthen the evidence base and invest in innovation. 

Digital technology is also cited as instrumental to improving monitoring and evaluation systems, early warning and preparedness initiatives and assessment data collection among others. One of the emerging topics in terms of using technology in humanitarian aid is digital identity. As the global digital scenario evolves, there is an inherent push from agencies for digital identity systems to solve the challenge of beneficiary authentication in humanitarian aid delivery, whilst ensuring beneficiary data protection. Given the beneficiary identification requirements of digital payments, debates on the scale-up of CTP cross-cut with debates on the future of digital identity. Current innovations include exploring the potential of biometric identity for more efficient administration of humanitarian CTP programs, through block-chain technology, which can make CTP faster and maximize efficiency gains in the process.

Despite significant growth in the availability and potential of new technologies, these are ineffectively and inefficiently used in humanitarian response, as a result of limited experience and expertise amongst humanitarian actors in engaging with private sector actors, and barriers to effective collaboration between humanitarian actors.

What should progress look like in this area?

By 2020, if the potential digital payments and new technologies has been maximised, this will mean that:

  • The humanitarian sector and private sector service providers collaborate predictably, around a set of agreed upon standards, based on clear entry points for collaboration
  • The cost-efficiency gains of working through the private sector to deliver CTP are maximised, through improved collaboration between humanitarian actors on new operational models to delivery CTP
  • Digital payment infrastructure has improved in fragile contexts with chronic humanitarian need
  • Consistent collaboration between humanitarian actors and longer-term financial inclusion initiatives

Photo Credit: Sam Tarling, Oxfam.

To address these challenges, humanitarian and development actors are currently engaged in a range of ongoing initiatives aimed at expanding or improving the use of the digital payment mechanisms and new technologies in cash transfer programming.

Ongoing initiatives and news

CaLP has continued to help promote the role of new technology within cash transfers. This is highlighted through its engagement with the Electronic Cash Transfer Learning Action Network (ELAN). ELAN aims to improve the use of e-transfers in emergency situations through providing information, technical support and resources. 

Building a global action agenda to enable digital payments in humanitarian response

Better than cash Alliance - The Better Than Cash Alliance provides government, private sector and development community the resources needed to transition to electronic payments

 

Definitions 

E-transfer: A digital transfer of money or vouchers from the implementing agency to a program participant. E-transfers provide access to cash, goods and/or services through mobile devices, electronic vouchers, or cards (e.g., prepaid, ATM, credit or debit cards). E-transfer is an umbrella term for e-cash and e-vouchers

Delivery mechanism: Means of delivering a cash or voucher transfer (e.g. smart card, mobile money transfers, cash in envelopes, etc.)

Resources 

For more publications on e-transfers visit our library.