Cash and Voucher Assistance

• Humanitarian Cash Assistance (also referred to as cash transfers or cash grants) describes assistance provided in the form of money - either physical currency or e-cash* - to recipients (individuals, households, or communities). Cash transfers are unrestricted by definition, which means recipients can choose how to use the assistance. As such, cash is distinct from restricted modalities including vouchers and in-kind assistance. The terms 'cash' or 'cash assistance' should be used when referring specifically to cash transfers only (i.e., 'cash' or 'cash assistance' should not be used to mean 'cash and voucher assistance'). 'Cash' is here applied broadly to include both physical currency and different forms of e-cash/ digital payments, but typically in regular use 'cash' refers only to physical currency (coins, notes).
• Humanitarian Voucher Assistance. describes assistance provided in the form of a paper voucher or e-voucher that can be exchanged for a set value, quantity and/or type of goods or services, denominated either as a currency value (e.g., $15), a predetermined range of commodities (e.g., fruits and vegetables) or specific services (e.g., a medical treatment)), or a combination of value and commodities. Vouchers are restricted by default, although the degree of restriction will vary based on the programme design and type of voucher. They are redeemable with preselected vendors or service providers or in 'fairs' created by the implementing agency.

Together, these methods form the cornerstone of CVA strategies. While they operate differently—with cash transfers providing broad flexibility and vouchers ensuring focused support—both aim to deliver efficient and effective aid that empowers recipients and meets their immediate needs during crises.

According to data reported in 'The State of the World's Cash 2023', which is created by the CALP Network (CALP), there has been an observed increase in the volume of Cash and Voucher Assistance (CVA) in the humanitarian sector. From the year 2020 to 2022, the volume grew from approximately US$6.6 billion to US$10 billion. However, this growth in CVA volume also coincides with an overall increase in humanitarian funding during the same period. When examining CVA as a proportion of total international humanitarian assistance, the increase appears more modest, from 20.3% in 2020 to 20.6% in 2022, which is an incremental rise of 0.3% a figure that CALP assessed could potentially rise to 30–40% if utilized wherever feasible and appropriate.

Terminology

In humanitarian aid, the evolution of terminology has been crucial in clarifying the nature and scope of financial assistance. Initially, terms like 'Cash Transfer Programming' (CTP) and 'Cash Based Assistance' (CBA) were broadly used to encompass both cash transfers and voucher systems. However, this usage often caused confusion, as it didn't distinctly differentiate between the two, despite their differing operational methodologies and impacts.

Cash transfers generally provide recipients with direct financial resources, offering them the autonomy to address their diverse and immediate needs. This modality is valued for its flexibility and broad applicability in various crisis contexts. On the other hand, voucher systems are typically more targeted, allowing recipients to exchange them for specific goods or services. These are often closely aligned with sectoral objectives within humanitarian clusters such as health, WASH (Water, Sanitation, and Hygiene), or shelter, and are tailored to address specific needs in these areas.

Recognizing these differences, the general term was changed to 'Cash and Voucher Assistance' (CVA) post-2018 to more accurately encapsulate both modalities. While humanitarian cash working groups may provide guidance on vouchers in some contexts, it's often different sectoral humanitarian clusters that manage voucher systems due to their sector-specific objectives. This distinction ensures that both cash transfers and vouchers are used effectively to meet the varied needs of affected populations, making humanitarian responses more efficient and targeted.

It is equally important to clarify what falls outside the scope of CVA, as commonly understood in humanitarian terminology. CVA does not encompass financial transactions such as payments to governments, remittances, or microfinance activities. These are separate categories of financial interactions, serving different purposes often related to long-term economic development or structural financial support, rather than direct crisis response.

Additionally, the term CVA is not typically used to describe longer-term economic recovery or development initiatives. This includes livelihood activities such as providing business grants to micro and small enterprises, village grants, or implementing poverty-focused programs. These activities are oriented towards sustainable economic growth and poverty alleviation over a longer term. In common humanitarian terminology, these are distinct from the immediate and direct support characteristic of CVA, which is targeted at addressing the critical needs of individuals and communities in the throes of a crisis.