Exploring benefits of mobile cash transfer systems
This paper reports on the first randomized evaluation of a monthly cash transfer program delivered to households via the mobile phone money transfer system (called zap) in Niger. This initiative was a part of a series of social protection programs following a devastating drought in the country that affected many villages.
In the program, one third of targeted villages received a monthly cash transfer via zap, whereas one third received manual cash transfers and the remaining one third received manual cash transfers plus a mobile phone. Findings of this study include:
Zap delivery mechanism strongly reduced the variable distribution costs for the implementing agency and program recipients costs of obtaining the cash transfer;
Households in zap villages used their cash transfer to purchase a more diverse set of goods, had higher diet diversity, depleted fewer assets and grew more types of crops, especially marginal cash crops grown by women;
Potential mechanisms underlying these results are the lower costs and greater privacy of receiving the cash transfer via the zap mechanism, as well as changes in intra household decision making.
This paper concludes that mobile transfers could be a cost effective means of providing cash transfers for remote rural populations, especially those with limited infrastructure.