Economic Development - Are Cash Transfers Crucial in Cutting Poverty?

Cash transfers have become one of the main social protection tools in the developing world. This short topic video looks at the debate over the effectiveness of cash transfer programmes in low and middle-income countries. We also highlight the work of the NGO Give Directly.

• 648 million people in the world, about eight percent of the global population, live in extreme poverty, which means they subsist on less than US$2.15 per day (PPP)
• Almost a quarter of the global population, 23 percent, live below the US$3.65 PPP poverty line
• 47 percent, live below the US$6.85 PPP poverty line
• Global median income is US$7.60 PPP per person per day

Cash transfers are a type of social protection programme in low-income countries that provide direct financial assistance to vulnerable households. Cash transfers generally involve providing a set amount of money per month in a local currency or in $s to eligible households.

Conditional cash transfers (CCT) require that the recipients meet certain criteria, such as sending their children to school or attending health checkups and having children immunized

Unconditional cash transfers (UCT) are provided without any such requirements. They are provided universally.