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Bigger, better and faster

As part of the IRC 2020 strategy, the organization has committed to deliver emergency cash assistance within 72 hours of a crisis where appropriate. This article highlights IRC’s  programmes, research and policy initiatives to investigate the most effective and appropriate means to increase emergency preparedness for predictable, recurring emergencies.

Under a new organizational strategy, IRC 2020, the IRC has committed to more responsive and rapid emergency responses, with the goal to deliver emergency lifesaving assistance within 72 hours. Cash transfer programming is highlighted as a core life-saving intervention to more appropriately meet the diverse needs of crisis-affected populations. Realizing that current organizational settings, humanitarian policies and financial infrastructures in the most disaster-prone areas do not allow meeting this target, the IRC is ramping up its efforts in cash preparedness. A range of program, research and policy initiatives are underway to strengthen the preparedness efforts across the humanitarian system as well as IRC’s own readiness to respond. These include:

  • Pre-Crisis Market Mapping Analysis Guidance: In 2014, the IRC and Oxfam partnered to develop the Pre-Crisis Market Mapping and Analysis guidance document to support organisations to conduct market assessments in crisis-prone contexts prior to any emergency. Pre-Crisis market analysis identifies ahead of a crisis appropriate responses, and informs preparedness planning and disaster risk reduction efforts.
  • Humanitarian preparedness in digital finance: Recognizing that expanding digital payment mechanisms is critical for more effective cash-based responses, the IRC launched a series of research projects to explore the levels of investment and incentive structures for government, humanitarian and private sector actors to increase investment in digital financial infrastructure. Research results will be available in early 2016 in advance of the 2016 World Humanitarian Summit.
  • Global Payment Toolbox: In order to improve the timeliness of its emergency responses, IRC is identifying and establishing agreements with global financial service providers that offer electronic payment mechanisms - prepaid cards, remittances, and mobile money - to develop a “catalogue” of transfer mechanisms to be triggered in emergency response.
  • Cash delivery R&D initiative: The IRC and technology company Segovia are working together to solve critical problems in the implementation of cash transfer programs to make them more cost efficient, timely and sensitive to the costs borne by program participants focusing on how to improve beneficiary identification and targeting, and how to improve cash distribution processes, inclusive of payment disbursements.

For further information on these initiatives, you will find contact details at the end of the article.

Prepositioning cash programs ahead of crises

In late 2014, MasterCard and the IRC partnered on a one-year program  to strengthen  capacity to rapidly deliver emergency cash assistance, with emphasizing the important role of digital payments where necessary to improve speed of delivery. With the ambitious goal of delivering cash within 72 hours, the IRC conducted a headquarters to field review of all business processes related to cash transfer programming. This analysis revealed the current organizational setting allow the IRC to design and implement cash programs in emergencies within 4 to 6 weeks. In order to whittle down the start-up and delivery timeframe, the IRC critiqued existing business processes, identified procedures which could be minimized in an emergency, and identified processes which could be wholly pre-positioned in advance of a crisis.  

These findings were formulated into a Cash Preparedness Planning (CPP) process that aims to lay out the blueprints for prepositioning cash and voucher programs to respond to a specific crisis – either slow or rapid onset. The structure of the CPP mirrors the emergency cash project cycle, but seeks to consider which of the steps of the project cycle can be conducted ahead of the crisis and preposition materials that will be needed during the response. It is a 10-step process that guides the country team through conducting pre-crisis needs, markets, risk and security and payment provider assessments, defining the targeting strategy, choosing the most appropriate type of program, delivery mechanism, pre-identify transfer values and distribution plans, identifying the staffing needs for the program implementation and prepositioning agreements with identified vendors or payment providers.

The Ethiopia pilot

Ethiopia is suffering its worst drought in more than a decade, a condition exacerbated by El Niño. The water-warming phenomenon in the Pacific Ocean has affected weather conditions and severely reduced rainfall levels across a large part of Africa, hitting Ethiopia particularly hard. 80% of Ethiopians rely on agriculture as their livelihood, and the government says that 8.2 million people are in need of immediate food assistance. The IRC Ethiopia office recently led a contingency planning exercise over the course of 2015, which aimed to identify the most likely hazards the country may be facing and the severity of their impact on vulnerable populations. Unsurprisingly, drought has been identified as the leading hazard the country team would need to prepare for and cash transfer programming was assessed as a potential response option, offering a great opportunity to pilot the CPP approach.

                               Credit: John Abdu,IRC, Arsi, Ethiopia

From August to November, a cross-function Cash Preparedness Team at country level - composed of program, supply chain, finance, human resources and senior management staff - worked together to preposition a cash-based program in response to the potential failure of the next rainy season. Ethiopia has 2 rainy seasons which provide 2 opportunities for planting: the first of the year (“Belg” from February to May) and the second (“Meher”, from June to September). The programme aims to pre-position a seed voucher response (in Arsi zone, Oromia) to enable households most affected by the failure of the Belg season to plant during Meher. The pre-positioning effort has involved  assessing the likely needs, market functioning, payment and service providers; establishing protocols for beneficiary identification, reaching pre-agreements with unions and cooperatives (grass-root seed distributors), and addressing staffing requirements and capacity building needs to ensure quality implementation of the programme.

Additionally, detailed response plans have been put in place, so that if a drought hits, “reality check” assessments (using pre-developed assessment tools) will be conducted to ensure the relevance of the prepositioned programme to adequately respond to communities’ needs in a timely fashion. They will also indicate whether or not the programme should be implemented (as it is), revised (with adjustments to better fit the post-crisis situation) or disregarded (if major red flags are raised around markets or security for example).

Digital delivery mechanisms in cash preparedness

With the aim of responding faster to the drought, the CPP implies prepositioning not only assessments, programmatic decisions and agreement with vendors but also transfer mechanisms so they are ready to be deployed rapidly when the programme is activated. However, printing paper vouchers ahead of the drought would raise a number of challenges due to key pieces of missing information to be included on vouchers such as the type and amount of seed – which depend on the timing of the response. In order to maximize the programme’s ability to quickly adapt to the post-crisis situation, a digital voucher solution was preferred to paper vouchers. Thus MasterCard’s offline e-voucher system “MasterCard Aid” (MCAid) was used in the Ethiopia pilot.

A stock of smartcards, card readers and Android-enabled tablets have been prepositioned in Ethiopia in anticipation of the upcoming response. Smartcards –protected by a PIN number – will be pre-loaded with relevant beneficiary information on a web-based platform by IRC when the drought hits and distributed to beneficiaries. The cards can then be redeemed using card-readers deployed at points of sale. The tablets serve as an intermediary between the offline (voucher redemption) and online (voucher preloading and reconciliation) operations. At the end of the programme, smartcards, card readers and tablets will be collected by IRC and ready to be used again when necessary. Update prepositioned e-vouchers with beneficiaries and merchants’ information after rapid post-crisis assessments made much easier when compared to using paper vouchers.

Next steps

The prepositioned programme is being tested in a drought-simulation exercise in Addis Ababa that takes the participants through the post-crisis implementation of the CPP. Lessons learned from this prepositioning exercise and simulation will be available in early January 2016. A CPP Toolkit that supports country offices through a 10 steps cash preparedness approach will also be available in early 2016.

In 2016, IRC will continue to roll out and refine its CPP approach by implementing it in three additional countries. This is the first time a cash preparedness programme has been designed and prepositioned in IRC’s programme portfolio. However, the lack of significant available preparedness funds in the current humanitarian funding landscape remains a significant challenge to be addressed in order to scale-up emergency cash preparedness across the humanitarian system.

For further information on the CPP process and Toolkit, please contact Yoann Tuzzolino, Cash Preparedness Advisor, IRC.

For further information on IRC’s other cash preparedness initiatives, please contact:

  • Pre-Crisis Market Mapping Analysis Guidance: Emily Sloane, Markets Officer
  • Humanitarian preparedness in digital finance: Neetu Mahil, Cash and Voucher Officer
  • Global Payment Toolbox: Alan Grundy, Emergency Response Team – Cash and Voucher Coordinator
  • Cash delivery R&D initiative: Sana Khan, R&D Officer

 

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