Kenya: cash-for-work transfers through mobile money
The ICRC often uses cash-based interventions to support populations during their emergency and recovery periods. Due to the large sums of money involved, security can be a concern while delivering the funds. In Kenya, the ICRC recently tested the use of mobile cash transfers to pay the beneficiaries of one such intervention. The ICRC's Anne Mucheke reports.
In arid Northern Kenya, residents of Marsabit district often conflict with their neighbours in Moyale over water, pasture and arable land. Due to the lack of security, people cannot venture out to graze their animals or migrate, leaving them with no food and water. A prolonged season of drought in 2009 left the pastoralists at the mercy of humanitarian organizations for food and water.
Residents working to improve infrastructure
To address these needs, the ICRC, working together with the Kenya Red Cross (KRCS), initiated a cash-for-work programme aimed at improving the livelihood of the community. Over 300 residents from the most vulnerable households in Marsabit benefited from the project, in which they were paid to work on community assets, thereby improving infrastructure.
The residents decided on dam silting and building terraces as the preferred project. Each individual received 200 Kenyan shillings for each day they worked. More than 100 people worked fortnightly on a rotational basis for the six weeks that the project ran.
Paycheck via mobile phone
A unique feature of this project was that for the first time, the ICRC tested the use of mobile banking technology as a system of paying beneficiaries. This was done via M-pesa, an innovative solution which uses portable phones to transfer money.
'' It was necessary for us to find a more efficient system to make payments to beneficiaries and reduce the risks associated with carrying large sums of money,'' says Phillipe Mbonyingingo, an ICRC delegate.'' The M-pesa system offered an alternative delivery mechanism and we decided to test it in our cash-for-work project.''
The M-pesa system is operated by a local telecommunications firm. Millions of Kenyans are currently using the system to transfer money as well as make payments for various services.
In the past, very few people in these communities owned mobile phones. To curb this problem, those who worked were clustered into groups of ten and a leader was identified. The ICRC and KRCS bought ten phones and SIM cards, one for each leader. With the help of a local affiliate of the telecommunications firm, the leaders would collect their pay at the end of the week and distribute it to the other beneficiaries. The dealer also assisted team leaders to prepare a payment schedule ensuring that everyone was paid to avoid complaints.
Community leaders involved from the outset
The system proved innovative and cost effective and did not require Red Cross staff to travel to the field every weekend. This allowed the community leaders to get involved in the project right from the beginning through to the completion stage.
'' Compared to direct payments, the mobile transfer method is more reliable as it reduces the workload of staff members and eliminates security risks associated with transporting cash to payment sites, which may equally target the beneficiaries,'' concludes Phillipe.