GiveDirectly directly provides cash-based assistance to those in need, eliminating the need for intermediaries, and thereby significantly impacting global poverty. Here is how GiveDirectly impacts global poverty.
GiveDirectly is a nonprofit organization that originated in 2008 with a mission to grant people living in poverty greater autonomy over their financial decisions. By adopting this approach, the organization believes it restores dignity and enables recipients to allocate the cash where it deems it most valuable. The organization has been operational in several countries since 2009, including the DRC, Kenya, Liberia, Malawi, Mozambique, Morocco, Nigeria, Rwanda, Turkey, Uganda, the U.S. and Yemen.
Hurricane Fiona Response
While GiveDirectly primarily respects individuals’ autonomy in financial decisions, it also implements targeted programs focusing on specific issues such as emergency relief, climate and refugees. In 2022, the organization provided cash assistance to 4,748 low-income families from Puerto Rico and Florida affected by Hurricane Fiona, aiming to support those natural disasters impacted.
Natural disasters pose a severe threat to those already living in poverty. According to a World Bank study, such disasters push 26 million people into poverty each year, disproportionately affecting those with lower incomes. In the case of Puerto Rico, Hurricane Fiona struck just five years after Hurricane Maria, leaving little time for a stable recovery. The disaster exacerbated challenges, especially for those in rural areas, with around 760,000 people lacking access to water and 928,000 people without electricity.
GiveDirectly responded by distributing pre-loaded credit cards to Puerto Ricans in dire need of support. Utilizing revolutionary AI tools, the organization identified geographical areas requiring assistance and successfully ran simultaneous campaigns in 32 Puerto Rican municipalities.
The success of the way GiveDirectly impacts global poverty is evident in the positive results it has achieved through its cash-based assistance programs. To date, the organization has directed an impressive $650 million worth of aid to people in poverty.
The nonprofit shares first-hand accounts from beneficiaries who have benefited from the cash transfers. For example, Milka, a Kenyan man, is just one of the many who have been receiving monthly transfers from GiveDirectly. When asked about the impact of the donations, he talks about how the money has allowed him to start a small-scale cereal company which has significantly reduced the burden of supporting his family.
Another Kenyan recipient, Nyevu, described how “the weight of financial uncertainty that had burdened me for so long was finally lifted” after he received his first payment. He used the funds to purchase a wooden door for his house, providing a sense of security. He further invested in four goats, which not only provide income but also serve as an investment for a dairy cow in the future.
Both examples show how important it is to leave decisions up to the individual as each person will have different methods of using the funds to help their lives.
These examples underscore the importance of empowering individuals to make their own decisions, as each person has different ways of utilizing the funds to improve their lives.
Validation of the Organization’s Approach
The organization’s approach has undergone thorough research and received validation, demonstrating the effectiveness of direct cash transfers. Three hundred studies have supported this method. The studies have been compiled to illustrate the most efficient ways of providing cash transfers and to debunk the misconception that “you can’t just give money to poor people.”
For example, a study on the impact of unconditional cash transfers on poor households in rural Kenya found that in less than two years, the households had sustained increases in assets, as well as many knock-on long-term impacts.
The way GiveDirectly impacts global poverty has occurred through a straightforward yet effective method. By restoring financial autonomy to those living in poverty, the organization plays a vital role in the fight against global poverty without imposing rigid assistance on those in need.
– Daisy How