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Free Money to Decrease Poverty in Africa

Decrease Poverty in Africa
In order to combat poverty in Africa in 2012, the government of Niger began giving monthly payments to more than 100,000 families in poverty. A payment of approximately 9880 XOF ($16 USD) went into their bank accounts every month for two years, which more than doubled each household’s usual budget. The government opted to conduct this experiment based on past trials that proved that receiving sums of money was extremely helpful to households in poverty. The outcome of this experiment was that, when individuals in poverty received free money, they had more time and were able to find productive ways to spend it.

Experiments in Universal Basic Income (UBI)

Today, this experiment has become a precursor to more than 200 trials in 75 countries to provide monetary support to those in poverty. These science-backed trials began in the 1990s, where researchers randomly distributed different types of payment (i.e. credit for a textbook or direct cash) in order to gain a deeper understanding of the effects of each type of payment that every household will find most beneficial. This proposal became “universal basic income” (UBI), where households of a given country consistently receive a set amount of money on top of their current wage. Economist Tavneet Suri explains that this extra income “can [allow individuals to] invest in riskier things because they have their basic needs taken care of.”

These experiments are similarly occurring in Kenya, where the charity GiveDirectly is funding a monthly allowance of 2,250 Kenyan shillings to more than 21,000 people. Each individual receives a phone that dings on the first day of the month to alert them that money went into their account–and it will continue to ding for 12 more years.

GiveDirectly

GiveDirectly is a nonprofit organization that began in 2009 with the purpose of sending money directly to those who need it via their phone, focusing on Kenya, Uganda and Rwanda. It is working to end the stigma that people in poverty use money that they receive for alcohol, and instead provide evidence that this money creates a more productive society. Since its conception, GiveDirectly has given more than $580 million to 1 million individuals in poverty.

Measurable Outcomes of UBI in Africa

Science has proven that providing a steady income for those in poverty is extremely beneficial. Not only do they become more productive, but they are able to work and enjoy their time without worrying about choosing if they will pay rent or eat. Here are some examples of why this tactic has been extremely beneficial when confronting poverty in Africa.

  • More children have been able to stay in school because of their eliminated need to work for their family’s income, allowing them to stay in school and complete their education.
  • A steadier income allows for more risk and creativity, like opening a business.
  • Mental health is improved not only from the lack of stress regarding fulfilling one’s basic needs, but more citizens are also able to afford health insurance.
  • Many countries saw a rise in child vaccination following the implementation of UBI, along with healthier babies being born.

UBI could be one of the largest stepping stones to ending poverty if more countries take interest in it, already showing its effect on poverty in Africa in multiple different countries. With the implementation of this proposal, countries could find themselves with a healthier, happier and more educated population.

– Aspen Oblewski
Photo: Flickr

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MobileAid in Togo is Reimagining Poverty Reduction

MobileAid in Togo
MobileAid in Togo, also known as the Novissi initiative, is reimaging poverty reduction. A transnational collaboration brought this technology to Togo during the pandemic, and MobileAid in Togo is making such a difference that it could be a model for other countries.

The Problem

The COVID-19 pandemic was disastrous for Togo’s economy. Even prior to the pandemic, more than half of the country’s population lived in poverty. The government of Togo wanted to provide support to its neediest citizens, but conducting door-to-door surveys to do this was not effective and not safe healthwise during the pandemic. Even targeting the poorest cantons (counties) reached only a third of the neediest.

The Transnational Solution

The government of Togo and the Center for Effective Global Action (CEGA) at Berkeley University as well as the non-profit organization GiveDirectly worked together to create an efficient system to prioritize aid to those living on less than $1.25 per day. Through international collaboration, the team developed a program using satellite imagery, as well as cellphone metadata to reliably detect levels of wealth to target the neediest Togolese.

CEGA calls the concept, “MobileAid,” and in Togo it is also known as Novissi. Novissi translates to “solidarity” in the indigenous Ewe language.

GiveDirectly is an NGO that organizes mutual aid programs in the United States and around the globe. Its mission statement states, “We believe people living in poverty deserve the dignity to choose for themselves how best to improve their lives – cash enables that choice.”

How MobileAid/Novissi Works

The MobleAid/Novissi program uses ariel imaging to create ‘poverty maps,’ using indicators such as roofing material, the density of houses and the quality of road infrastructure. AI algorithms utilize phone records to identify those living in extreme poverty.

Recipients are invited to self-enroll in the program to receive direct cash payments through their mobile phones. In Togo, 85% of households have access to a cellphone. The MobileAid format provides recipients with aid rapidly and seamlessly. This includes poor rural recipients in need of aid who often fall through the cracks of other state social protection programs. Women receive larger payments due to their status as caretakers.

The Results

In the first three months online, the government of Togo distributed $22 million to 600,000 people. One recipient in Togo reported using aid for food, his children’s school fees and his business which was struggling due to the pandemic. After the initial launch, GiveDirectly pledged another $10 million to the initiative spread amongst 138,000 recipients.

Cina Lawson, Togolese Minister of Digital Economy and Transformation welcomed the innovative program, saying that “We have an institute of statistics that can make a survey on the ground … but we need a quick and effective way to have a poverty map.” She appreciated that Novissi increased the scope of those reached.

Recently, CEGA and GiveDirectly received a $1.2 million grant from the Inclusive Growth and Recovery Challenge. Lauren Russel, CEGA director of operations said that “The grant should allow for the project to be scaled and evaluated even further, with the hope that the methods might be well-suited for adoption by other low- and middle-income countries.”

Other Challenges

Vaccine inequality is extending the personal and economic suffering of COVID-19 in the Global South. Mobile technology can provide aid to countries that the pandemic hit hard. This infrastructure is necessary for future relief, with looming economic hardship not far out of sight. Togolese registered for vaccines through mobile technology.

Many countries in the Global South are suffering from the disproportionate effects of increased environmental challenges. Togo’s economy relies on rainfed agricultural and livestock production. According to World Bank, Togo ranks 135 out of 181 countries at risk of climate abnormalities. Nearly 5 million people live in Togo’s rural areas and are severely susceptible to droughts, floods as well as other environmental disasters. Togolese farmers endure the double burden of pandemics and rapid global heating. Mobile technology could potentially support these farmers through climate emergencies.

Looking Forward

Transnational collaboration and innovation are expanding the possibilities of aid in Togo. With colleagues from Berkeley to Lomé, the MobileAid initiative is tackling poverty reduction and empowering Togolese citizens through direct action. Funding these social innovative programs is critical for expanding the impact and scope of aid distribution. Vaccine inequality and global heating will exacerbate human and economic casualties. MobileAid is a strong new tool for fighting poverty and protecting the world’s most vulnerable populations against future global disasters.

– Samson Heyer
Photo: Flickr

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How NFTs can Fight Poverty

NFTs Can Fight Poverty
NFTs, or non-fungible tokens, have taken the world by storm as an efficient way to invest and make a profit. In contrast to the also widely known cryptocurrencies such as bitcoin, each NFT is one of a kind, with unique pre-installed code and data. NFTs are not in typical commercial transactions. They are more like art pieces that people can sell, trade or buy. Since bidders and buyers use crypto graphics as displays of wealth and to represent property rights, it might be surprising to think that NFTs can fight poverty.

Twitter CEO Jack Dorsey sold his very first tweet as an NFT for $2.9 million with the intention of donating the sum to GiveDirectly, a charity that supplies cash to various communities in extreme poverty around the world. Pioneering this wonderful use of the NFT, Dorsey conveyed his profits to the Africa Relief Charity through GiveDirectly in March 2021.

What is GiveDirectly?

Paul Niehaus, Rohit Wanchoo, Jeremy Shapiro and Michael Faye founded GiveDirectly in 2008. As the name might suggest, this organization provides direct money transfers to families in need worldwide, especially in African countries.

GiveDirectly operates in Uganda, Kenya, Rwanda, Liberia, Malawi, Morocco, Mozambique, DRC, Togo and the U.S. So far, this program has distributed millions of dollars to 20,000 people within 197 villages and surveyed an extra 100 villages to act as a control group for research purposes.

On top of one-time donations, the charity offers various useful programs and opportunities. One of GiveDirectly’s most beneficial schemes is its Universal Basic Income program, through which willing donors may donate $1 per day per individual.

Donors have the option of supporting one individual, three individuals, 10 people or an entire village. Some recipients will collect ongoing payments for 12 years, making this a great giving opportunity for those who have just scored big with an NFT jackpot.

NFTs, Millennials and Charity

Most, if not all of the time, NFTs sell for large sums of money, leaving the seller with an instant and enormous growth in their wealth. NFTs typically range in price from almost millions to millions of dollars. According to Morning Consult, millennials are the generation most involved in collecting and selling NFTs; a shocking 23% of those involved in NFTs were millennials.

Additionally, millennials suffered the most financially from the COVID-19 pandemic because they also experienced the 2001 recession and the Great Recession. Between the Great Recession and the recession that the pandemic caused, millennials are no stranger to money shortages. They are either on an ongoing job hunt, just lost their job or are unlikely to see a raise. Consequently, it is no surprise millennials swiftly took advantage of the NFT money-making format.

Urging NFT sellers to give to reliable charities like GiveDirectly is thus one avenue through which NFTs could have a significant impact on global poverty. An increasing amount of millennials are telling miraculous rags to riches stories, similar to the stories of the most charitable celebrities and millionaires.

Since competitive bidding systems determine NFTs costs, it is easy to wait for an NFT to reach an exorbitant price. Mike Winklemann sold the most expensive NFT for $69 million. The craziest bids amount to sums the average millennial may never see in their entire lifespan.

Celebrities who come from humble beginnings are the ones who donate the most, most notably Brad Pitt and Kanye West. With this empathy toward the experience of living in a state of prolonged scarcity and uncertainty, along with Jack Dorsey and his sold tweet’s respectable example, more and more NFT sellers may use their gains to aid in fighting poverty.

How NFTs Can Fight Global Poverty

A rapidly increasing number of millennials and zoomers are gaining a keen interest in NFTs, so it is valuable to have conversations with peers about what the funds could go towards, such as charitable endeavors. The young populace in the United States should know that NFTs can help in the fight against poverty.

– Fidelia Gavrilenko
Photo: Flickr

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MacKenzie Scott’s Philanthropy

Mackenzie Scott's PhilanthropyMacKenzie Scott, one of the wealthiest women in the world, inherited a 4% stake in Amazon following her divorce from Jeff Bezos in 2019. At the time, the stake held a value of $38 billion, growing to more than $60 billion today. Following her divorce, she signed onto the Giving Pledge, which U.S. investor Warren Buffett, Microsoft founder Bill Gates and Melinda Gates of the Gates Foundation established, pledging to give away at least 50% of her wealth to charity or “until the safe was empty.” In contrast to other pledgers, such as Mark Zuckerberg, Bill Gates and Buffett, Scott did not wait to live up to her promises. So far, Mackenzie Scott’s philanthropy has resulted in $6 billion to 500 organizations in 2020 with a further $2.7 billion in 2021.

Vast Reach

The goal behind Mackenzie Scott’s philanthropy is to maximize her impact by donating to charities that other philanthropists often overlook. A $1.68 billion donation in 2020 went toward addressing various social issues. The largest portion ($587 million) of the donation went to racial equity, but a significant amount also went toward economic mobility ($399.5 million), global development ($130 million), functional democracy ($72 million), LGBTQ+ equity ($46 million), empathy and bridging divides ($55 billion), among other issues.

As a result, not only is Mackenzie Scott’s philanthropy generous but it also focuses on making the largest impact across a variety of social issues. In particular, in her latest donation of $2.7 billion, she emphasizes giving to more than 700 million people that live in extreme poverty across the globe. The objective was to find solutions with “on-the-ground engagement and diverse engagement.” Therefore, local teams with female leaders and people of color held priority positions.

To name a few, these organizations include Dream a Dream, GiveDirectly and Muso. Specifically, Dream a Dream focuses on empowering children from destitute backgrounds to receive an education and garner skills that will help them thrive in today’s world. GiveDirectly is a platform that provides direct cash transfers to people in need, primarily in African countries, with most people spending the aid on medicine, food, education and entrepreneurial projects. Last but not least, Muso focuses on preventing global deaths that arise from extreme poverty with frequent home visits to patients and access to care clinics. All of these organizations have different strategies on how to battle poverty and alleviate the issues that stem from it, employing diverse teams to enable more creative and effective solutions.

COVID-19 Funds

In addition to donating to poverty-related causes, the focus of Scott’s giving in 2020 was the COVID-19 pandemic. Estimates indicate that $4 billion out of the $6 billion that Scott gave away last year went directly to COVID-related causes. Scott’s donation accounts for about three-quarters of billionaire and high-net-worth individual pandemic-related philanthropy. Scott expresses that the pandemic fostered fresh inequalities in the world’s systems and that she feels compelled to do her part in improving an unjust and often unstable world. Therefore, Scott is not only staying true to her promise but has also become one of the most generous givers in recent years.

A Worthy Cause

MacKenzie Scott’s pledge to give away “until the safe was empty” represents a fresh and positive force to solve social problems that other philanthropists frequently overlook. Mackenzie Scott’s philanthropy is not only generous but also strategic with a focus on on-the-ground strategies and organizations with diverse teams to maximize the impact of her donations. Scott’s donations address racial inequality as well as global poverty and the consequent problems arising from it.

– Max Sidorovitch
Photo: Flickr

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Novissi GiveDirectly Alleviates Poverty in Togo

Novissi GiveDirectly Togo, a West African country home to 8 million people, wants to put money into the pockets of its most vulnerable citizens in order to alleviate some of the economic burdens of COVID-19. The most impoverished Togolese people, however, are often the most difficult to locate as they tend to live in remote areas and have little or no record of income. To address this issue, the government of Togo partnered with researchers at the University of California and the U.S. charity called GiveDirectly. The team is using artificial intelligence to identify pockets of extreme poverty within its borders. The program called Novissi GiveDirectly intends to stabilize the economy by uplifting those most in need.

The Initial Novissi Program

“Novissi” translates to “solidarity” in one of the local languages of Ewe. The initial Novissi program already distributed $22 million via mobile money payments to 600,000 citizens who live in urban areas. Voting registration provided the state with information about a citizen’s financial status and the state used this information to determine eligibility. Then, payment was sent via mobile devices. However, this same methodology could not be applied to the many Togolese who live outside the cities and identify as informal workers. The government wanted to target people in rural areas living on less than $1.25 per day without the means to put themselves on the government’s radar. Presented with this challenge, a second phase of the program emerged: Novissi GiveDirectly.

Novissi GiveDirectly

In Togo, Novissi GiveDirectly utilizes satellite imagery, mobile data and artificial intelligence as a poverty solution. Satellites capture photos from every square kilometer of the country, giving insight into villages’ local infrastructure, the housing materials used and even the size of land plots.

Mobile data also provides researchers with a major clue in the search for those carrying the biggest financial burdens. In general, impoverished people use cellphones less often, receive more calls than they make and have lower mobile money balances. Artificial intelligence then analyzes the mountains of data to identify who is eligible to receive aid from the program by estimating an individual’s wealth. Registration is as simple as a Togolese citizen dialing #855 to register for the program.

The Impact on Locals

Eric Dossekpli is a 49-year-old farmer whose livelihood has experienced a direct impact from COVID-19. His market goods were not selling because people were not buying due to the financial distress of the pandemic. This left him without an income and unable to afford fertilizer to continue growing crops.

When Dossekpli heard about Novissi GiveDirectly, he immediately registered. Once Novissi GiveDirectly confirmed his eligibility, he received an instant mobile payment of $13. Novissi GiveDirectly gives $13 to men and $15 to women every month for five months. Women receive more money due to their roles as caregivers. The money received meant he could pay for his children’s tuition and afford food. “I can’t imagine how I was going to live if not for this money. All I can say is thanks,” said Dossekpli.

The Road Ahead

What makes the program unique is that it operates using data that is already available. This makes it quick and comprehensive, two characteristics that are critical during a crisis. The program aims to distribute $10 million to 114,000 Togolese people over a period of a few months. The Novissi GiveDirectly model is currently being considered for Nigeria and Bangladesh.

Though Novissi GiveDirectly has emerged in response to a crisis, one cannot help but consider the potential benefits of such targeted investments long-term. If $13 can pay for the education of four Togolese children during a global pandemic, a sustained investment of this nature could boost an entire economy, allowing everybody to reap the rewards.

– Greg Fortier
Photo: Flickr

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Examining Universal Basic Income in Kenya

Universal Basic Income in Kenya
Imagine if one received free money from the government every month, directly into their bank account with no one asking any questions. It may sound too good to be true, yet that is the main premise behind universal basic income or UBI. Universal basic income in Kenya is going a long way toward fighting the results of the COVID-19 pandemic.

What is Universal Basic Income?

With UBI programs, governments, organizations or private funders deposit direct cash payments to citizens monthly. These deposits occur regardless of status or circumstance with no strings attached. This means no interest and no expectation to recipients to repay the money. UBI programs intend to supplement or even entirely replace other financial social programs and help those struggling financially. The goal of this financial aid is to prevent vulnerable groups from falling deeper into poverty. In addition, it works toward alleviating national poverty on a wider scale.

The idea of universal basic income has long been under debate with skeptics insisting that providing free money to the impoverished would only lower the incentive to work, bankrupt any government who would give it an honest try and fail to address the root causes of poverty. While these criticisms are well grounded, UBI has nonetheless collected a growing base of supporters. Early supporters of a UBI program date back to the Enlightenment, including political activist and philosopher Thomas Paine and French general and emperor Napoleon Bonaparte. In more recent years, supporters have included Silicon Valley giants Bill Gates and Jeff Bezos and South African billionaire Elon Musk. Others range from author Milton Friedman to Pope Francis.

UBI in Practice Globally

Perhaps surprisingly, countries all over the world have experimented with UBI programs. What may come as an even bigger shock is that it has been in use in the United States for the last four decades. Since 1982, Alaska has implemented the Alaska Permanent Fund, an investment fund that disperses a dividend of anywhere from $1,000 to $2,000 to every Alaskan resident including children. The results have virtually eliminated extreme poverty in the state. Extreme poverty refers to those living on $2 or less a day.

Outside of North America, UBI programs have undergone implementation in every continent except Antarctica, from Brazil to Japan with a varying degrees of success. This highlights the widespread capabilities and applications that are possible with basic income systems. However, 2020 introduced a new variable to the theory of UBI. How would a basic income system affect communities dealing with the adverse health and economic effects of a global pandemic?

UBI and COVID-19

The longest-running and most ambitious attempt at a universal basic income system is currently underway in Kenya. Since 2016, nonprofit GiveDirectly has been sending direct cash payments to more than 14,000 households in the Siaya and Bomet Counties of Kenya. The mission is to continue the program through 2028. In doing so, it will collect decades worth of data on the effects of UBI on poverty-stricken communities.

However, the unprecedented arrival of COVID-19 has brought disastrous effects to Kenya’s economy and will likely send millions into poverty. The unpredictable addition of a global pandemic has enabled researchers to examine the effects of an established universal basic income infrastructure. This situation provides invaluable insight into how a basic income system might help vulnerable communities cope with a large-scale crisis.

Based in the Siaya and Bomet Counties of Kenya the program split the recipients of cash payments into four groups. These groups included long-term, short-term, lump sum and a control group. For long-term recipients, every adult for the duration of the 12-year program is to receive $0.75 per day. This amount sufficiently covers food expenses and basic health and schooling needs.

The short-term recipients received the same amount for basic needs, $0.75 per day, for two years. The third group received a lump sum that amounted to a one-time payment of $500. Finally, the control group did not receive any payments at all. This allowed an honest comparison amongst villagers to evaluate the significance that UBI payments had on individuals who received payments.

The Results

Those receiving universal basic income in Kenya experienced better food security and were less likely to report experiencing hunger in the past 30 days. This resulted in a widespread improvement in overall rates of hunger. Hunger rates fell from 68% to 57%, with the strongest improvements coming from the long-term group of recipients.

Looking at general health including mental health, UBI recipients showed promising results. Results indicated that payments reduced the probability that an individual would seek medical treatment. Furthermore, households were around six percentage points less likely to report that a household member was ill. Research also suggests that payments reduced hospital utilization, which helped preserve hospital capacity. Having the peace of mind that at least one stream of income would remain steady certainly played a factor in improving the well-being of Kenyan’s facing economic uncertainty.

Universal basic income payments helped individuals stay resilient through the devastating effects of COVID-19. Nevertheless, basic income is still far from a silver bullet for fighting poverty. In Kenya, UBI was not effective at completely protecting recipients from economic hardship, and by nature, a UBI program will expose individuals to economic volatility and cannot guarantee complete financial protection.

However, payments allowed individuals a crucial advantage in holding on to basic needs such as food and healthcare in comparison to those without any basic income payments. This demonstrates that putting the infrastructure in place for universal basic income in Kenya can provide much-needed relief and security to citizens when they need it most.

– Andrew Eckas
Photo: Flickr

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GiveDirectly’s Cash Transfer Project for Kenyans

GiveDirectly’s cash transfer projectIn March 2020, GiveDirectly launched The Kenya Emergency Cash Fund to protect vulnerable Kenyan communities by sending recipients cash through mobile wallets. GiveDirectly is a nonprofit organization operating in East Africa that works to alleviate extreme poverty. Since its founding in 2009, GiveDirectly has given over $160 million to 170,000 families in the region, eventually earning a 100% rating from Charity Navigator. GiveDirectly’s cash transfer project is an initiative to help low-income Kenyans, especially during COVID-19.

Kenya Emergency Cash Fund

The Kenya Emergency Cash Fund, also known as the Kenya COVID-19 Fund, was formed in partnership with the Shikilia Initiative, which is a collaboration between the Kenyan private sector and nonprofit organizations. In coordination with GiveDirectly’s cash transfer project, Shikilia’s goal during the pandemic is to provide 200,000 people with monthly transfers of $30 for the next three months.

“We currently have enrolled 11,000 adults into the program and have disbursed around $300 to these recipients,” Director of Recipient Advocacy, Caroline Teti, told The Borgen Project. Teti joined GiveDirectly in 2016. She hopes to put an end to the devastating and disempowering nature of poverty across Africa through innovative projects such as GiveDirectly’s cash transfer project.

GiveDirectly has already launched settlements in Mathare, Kibera, Korogocho, Mukuru and Kawangware. This is crucial since resident families of these settlements live on $2 or less and are therefore expected to take the hardest economic hit as a result of the pandemic. For example, Teti reported that as a result of COVID-19, 95% of people in Mathare are eating less.

Recipients barely had savings before the pandemic. So, without GiveDirectly’s cash transfers made available to low-income communities by the Emergency Cash Fund, Teti believes that “families would have snuck back to the villages, increasing transmission risks to older people living in the countryside.”

Making Cash Transfers Efficient

In order to ensure that these cash transfers made to recipients are efficient, GiveDirectly is partnering with Shining Hope for Communities, a grassroots movement that catalyzes large-scale transformation in urban slums in Kenya.

Methods GiveDirectly and SHOFCO use to reach recipients more rapidly include using existing databases of low-income households, using rosters provided by local vetted NGO partners and using rosters of mobile money subscribers recruited through partner mobile network operators.

Project 100

Though GiveDirectly’s priority is getting cash to hard-hit families in extreme poverty in Kenya, it also organized Project 100 to raise funds for U.S. families impacted by COVID-19. For this project, GiveDirectly partnered with Propel, a company that helps recipients of the Supplemental Nutrition Assistance Program manage their benefits. The project aims to raise a total of $100 million for recipients.

The Road Ahead

According to the World Bank, poverty in Kenya may still remain above 20% by 2030 if it continues on a minimal growth path. More job opportunities for youth and infrastructure investments that improve transportation and service deliveries would be necessary to raise Kenya’s productivity.

Through GiveDirectly’s cash transfer project, an efficient and simple method of delivering cash, small-scale businesses will have the opportunity to grow, especially when food insecurity is no longer an obstacle. As Teti says, “We must rethink recipient empowerment and consider cash as a model for changing the lives of people living in poverty.”

– Joy Arkeh
Photo: Flickr

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The Success of the UBI System in Kenya Amid COVID-19

UBI in KenyaIn 2019, former Presidential candidate Andrew Yang proposed a universal basic income and introduced many Americans to the concept. For the developing nation of Kenya, UBI has been an ongoing research project for years.

Universal basic income is a system in which the citizens of a country receive a recurring payment from the federal government for basic necessities such as food, housing and medicine. The goal is to lessen wealth inequality while fostering a higher standard of life regardless of one’s status in society.

Universal basic income in Kenya started in 2017 as a study to map the effectiveness of supplying money to individual villages. In each village, a different stipend was doled out with varying degrees of frequency. The $30 million UBI program was created with the help of GiveDirectly, a non-governmental organization dedicated to addressing global poverty through direct payments. In both 2019 and 2020, researchers followed up with more than 8,000 people involved in the study. What they found proves the success of universal basic income programs to improve food security, health, and mental and emotional well-being.

How the Cash is Distributed

For this study, it is important to note how the payments were allotted to the 14,474 households that participated. The researchers split counties in rural Kenya into four groups. The people in the first set of villages received $0.75 per day for 12 years. The second group received the same stipend but for only two years and was therefore never surveyed during COVID-19. The third group received a one-time lump sum of $500. Finally, the last division of villages was given nothing to act as a comparison.

Food Insecurity

The comparison group, which received no UBI, reported only 32% food security in the last few years. The three UBI groups who received payments reported a notable decrease in hunger between 5-11 percentage points. The study shows that the first group, which received a recurring amount during 12 years, experienced the smallest hunger levels. This suggests that UBI in Kenya can alleviate hunger, especially when provided in smaller payments over time.

Physical, Mental and Emotional Well-being

Universal basic income in Kenya also affects physical health. About a third of respondents without a stipend said they sought medical attention in the last month. However, those in the UBI groups were healthier, with fewer respondents reporting clinical visits or sick family members. Given the lack of COVID-19 cases in the respective villages, the pandemic did not change the findings.

The researchers also found that degrees of depression varied by the method in which the income was distributed over time. Mental health was considered low in the cashless group. Not all UBI groups benefited; however, the group provided with the $500 lump sum reported high levels of depression. Some researchers speculate that receiving a cash payment in regular increments is more beneficial to one’s mental and emotional well-being.

During the Pandemic

The COVID-19 outbreak has brought to light how beneficial a universal basic income program can be when faced with unforeseen financial setbacks like a pandemic. When the study researchers checked in with Kenya in 2020, the pandemic struck the world. Only 12 cases existed in Siaya and Bomet, where the study was being conducted. Kenya underwent a strict lockdown in March, pushing vulnerable people living in rural communities into even more precarious situations. The study showed that UBI recipients were less likely to engage in social activities or visit a clinic, both of which increase the likelihood of catching the virus.

While the study is new and not fully complete, good signs point toward a permanent UBI in Kenya because of the proven benefits. Universal basic income has the ability to offer financial assistance and stability to lessen the blow of the pandemic for Kenyans. With UBI, Kenya has the potential to help those in desperation and foster a higher standard of living for all.

– Zachary Sherry
Photo: Flickr

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Cash Grants in Kenya: Elevating Poor Communities

cash grants in Kenya
If you have ever wondered what good remittances do for poverty reduction, a study done by the researching nonprofit Innovations for Poverty Action (IPA) could help put things in perspective. Researchers at IPA evaluated the economic progress of Kenyan villages from 2014 to 2017 after families were given unconditional cash transfers or UCTs. The cash grants in Kenya were provided by a charity organization called GiveDirectly.

The results of the study highlight the potential UCTs have to financially elevate communities around the world. However, when dispersed without careful consideration, some aspects of cash transfers can be detrimental. Let’s discuss GiveDirectly’s trial and why it was successful in initiating great economic stimulation in Kenya.

The Logistics of the Study

The study took place in villages surrounding Lake Victoria in Siaya County, Kenya. To avoid a concentration of funds, researchers categorized villages by two groups: villages with high saturation and low saturation status. Random assignment appointed two-thirds of high saturation villages and one-third of low saturation villages to the trial. As an extra measure to confirm financial need, GiveDirectly only chose families residing in homes with a thatched roof; about one-third of households qualified.

GiveDirectly provided money transfers in intervals to a family member, totaling 87,000 KES, or 1,000 USD. Data was recorded through baseline and closing surveys taken by the participating families and local business owners. The surveys covered topics such as “household financial, physical, and mental well-being, business performance, changes in market prices, and the provision of local public goods.”

Cash Grants in Kenya: The Results

The increase of income stimulated a surge in spending from recipient families. For the most part, these expenditures occurred in the region. Business disclosed that 86% of their clientele were from local or neighboring villages.

The increased consumption had a spillover effect, as non-participant households also saw an influx of income. According to their report, GiveDirectly claims that having higher local enterprise revenues, “in turn, appears to increase the income of local untreated households, leading to higher spending on their part.” The grants created a pattern of earning and consuming that resulted in overall higher cash flow in the area.

Furthermore, participant households across the board showed “higher levels of psychological well-being, food security, education, and security.” Increasing their financial security had an overall positive impact on many other aspects of their lives.

Why it Worked

Before the 2014 study, UCTs previously given by GiveDirectly were also proven to generate economic stimulation in Kenya due to rising consumption and investments. To fully understand the results of this study, it is important to note a few specific factors.

First, GiveDirectly provided UCTs rather than conditional cash transfers, or CTTs. The World Bank defines CCTs as being “contingent on behaviors like school attendance and visits to health clinics.” These requirements do not come as easily to some families as others, especially those living remotely. In contrast, UCTs provide financial support to families without burdening them with specific requirements that they may be unable to meet.

The location also played a big role in the success of this trial. GiveDirectly chose families from an area containing a major national road that IPA determines may be one of the reasons for economic overspill. The IPA report also depicts Kenya’s traditional “harambees,” gatherings meant for community fundraising, as another cause for the balanced wealth distribution.

Moving Forward

The economic stimulation in Kenya proves the efficiency of tactful cash grants. GiveDirectly’s accomplishments in poverty alleviation are just a fraction of what is possible. Moving forward, if more funds are devoted to foreign poverty aid, it is possible for such results to be seen on a global scale.

– Lizt Garcia
Photo: Flickr

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Artificial Intelligence Helps Impoverished Communities during COVID-19 Pandemic

BlueDot, a Canadian artificial intelligence company, alerted its customers of an outbreak more than a week before the WHO notified the public of the COVID-19 outbreak. The company uses programs driven by artificial intelligence to analyze large amounts of information with the goal of discovering disease outbreaks. This company – and many others like it – could be key in helping thousands of people navigate COVID-19.

What is Artificial Intelligence?

Artificial intelligence is a branch of computer science focused on intelligence displayed by machines. There are both pros and cons associated with the development of artificial intelligence. However, with the possibility of COVID-19 pushing 50 million more people into poor households in 2020, many countries are doing everything they can to harness this developing technology.

Artificial Intelligence, COVID-19 and Poverty

People in impoverished communities are facing a serious dilemma: should they continue to work and potentially catch COVID-19 or stay home and face hunger or malnutrition?

There is currently no vaccine for the virus, and lockdowns and social distancing measures are effective but economically harmful. Most people in poverty do not have the financial savings to support themselves. Similarly, restrictions have the potential to push already unstable economies in less developed countries into a recession. Fortunately, artificial intelligence is providing new ways to support people in such challenging times.

4 Ways Artificial Intelligence Can Help Impoverished Communities During COVID-19

  1. Satellite images and phone data are assisting in identifying communities in need of financial assistance. Policymakers in Togo, a West African nation, teamed up with UC Berkeley to find ways to use satellite images and phone data to identify the country’s most impoverished communities and provide aid. A similar program is already in use in various African countries. The NGO GiveDirectly partnered with a local phone company to give governmental assistance to subscribers who live in impoverished communities. The government contacts citizens and offers them a cash transfer. In March alone, GiveDirectly made payments totaling over $2.5 million to 13,806 recipients.
  2. The technology could help researchers analyze COVID-19 data and make clinical decisions. A doctor from Kashmir is using artificial intelligence to detect patterns in large amounts of COVID-19 data. Currently, there is an overwhelming influx of public health data surfacing. In addition, with the virus’s potential to push more people into poverty, there is a need to analyze and evaluate the data quickly. The doctor is also working with local professionals to discover innovative ways to provide healthcare in the country.
  3. Developing countries have started using artificial intelligence for surveillance and social control. Nations like Ecuador, Kenya, Peru and South Africa are using surveillance technologies to ensure citizens are using social distancing measures. South Africa implemented a “real-time contact tracing and communication system.” The software used to create the system was originally intended to detect rhinoceros poaching hotspots in national parks.
  4. Artificial intelligence makes it possible to accurately screen many people at a time from a distance. China has used the technology to install distanced fever-screening systems in railway and subway stations. Beijing’s Qinghe Railway Station houses one of the systems, which can “examine up to 200 people in one minute without disrupting passenger flow.” Many developing countries are densely packed, and many people in those countries have poor access to healthcare. Screening large numbers of people in a short period of time can have a positive impact on the fight against COVID-19 in developing countries.

The race to harness artificial intelligence is on around the globe. Artificial intelligence has the potential not only to alleviate the impacts of COVID-19 on developing countries but around the world. The public database Kaggle is sponsoring the COVID-19 Open Research Dataset Challenge. Its hope is that experts around the world will come together to find new ways to use artificial intelligence techniques. Ultimately, this will produce new insights to assist in the global fight against COVID-19.

– Araceli Mercer
Photo: Flickr