The COVID-19 pandemic has pushed an estimated 124 million people into extreme poverty globally, the first increase in extreme poverty in 20 years. To meet the magnitude of this need, governments around the world have dramatically ramped up social protection measures, and in particular cash transfers, which comprised one-third of all COVID-related social protection programs. A staggering 17 percent of the world’s population, or 1.3 billion people, were covered by at least one COVID-related cash payment between 2020 and 2021.

Despite this increase, the scale-up of cash transfers has been uneven across the globe. In low-income countries, cash transfers reached an average of 4.5 percent of the population, a figure six times lower than in the average high-income country. COVID-19 has shown that we must transform our aid delivery systems to reach the world’s poorest.

For many of the world’s poorest countries, creating an end-to-end system that identifies, enrolls, and delivers financial aid at scale to individuals in need is challenging. Unlike in the U.S., where the government can send payments based on information from recent tax returns, many low-income countries do not have up-to-date databases to screen households based on need or income. These countries may also lack sufficient internet coverage, making applications for assistance via a government-run online portal infeasible. Going door to door to screen and enroll people would also have been time-intensive and challenging with social distancing measures.

Fortunately, several examples have demonstrated that investing in digital cash transfers can help governments expand social assistance at unprecedented speed and scale. Take the example of Togo. At the start of the pandemic, in just 10 days, the Togolese government built and launched NOVISSI, a digital mass payment platform, and model for direct cash transfers, allowing beneficiaries to enroll and receive payments within 120 seconds via basic mobile phones—without internet.

Read the full article about digital cash transfers by Anir Chowdhury, Cina Lawson, Elizabeth Kellison, Han Sheng Chia, Homi Kharas, Jacquelline Fuller, Michael Faye, Michal Rutkowski, Rodrigo Salvado, and Stefan Dercon at Brookings.