13 Jun 2022

Distributing early cash to address food insecurity in Madagascar: success stories from Welthungerhilfe’s activation in 2021

The year 2021 was exceptionally dry in Madagascar. In January, Welthungerhilfe’s Early Action Protocol (EAP) for Drought-induced Food Insecurity was triggered for Ambatondrazaka District, Alaotra-Mangoro – one of its six EAPs in the north and north-east of the country. The trigger was met at a relatively low threshold and, as a result, the Start Network released pre-positioned funds, provided by the German Federal Foreign Office, to implement early cash distributions.

This early action targeted the most vulnerable people in the region to reduce the risk of food insecurity, prevent negative coping strategies and minimize the loss of household assets among drought-affected households. It was distributed early as unconditional cash grants to households, which were provided before the peak of the lean season as ‘mobile money’ transfers.

Why was cash used as an early action?

During workshops to design the EAP, attended by local stakeholders, local communities and national stakeholders, participants considered a number of potential drought scenarios and the negative coping strategies that people might adopt for each. Coping strategies identified included: reducing meals; eating ‘less preferred’ food; labour migration; increased school drop-out rates; and unsustainable firewood production. Early cash can help to address each of these by allowing recipient households to decide for themselves how best to cope with the impacts of drought.

The decision to distribute cash was further informed through a study to assess whether the market could absorb an additional cash influx, and a baseline study to assess cash-transfer recipients. The main participants in this evaluation were wholesalers and retailers in Ambatondrazaka. Through these, the Welthungerhilfe team was able to assess the capacity of the market and anticipate how it might react to an increase in demand caused by the cash injection from this intervention.

The analysis indicated that the market had the capacity to absorb and adapt to a sustained increase in demand. Additionally, it suggested that the start of the harvest period would reduce potential inflation due to an influx of produce (there would still be a small harvest, despite the drought). Overall, the assessment found that cash transfers to the most vulnerable households would be one of the fastest, most suitable options to help them cope with the impending drought.

Early cash: an effective early action

To prepare the beneficiaries to receive their cash as a mobile money transfer, Welthungerhilfe and its mobile money provider distributed phones and then registered people for mobile money accounts. As mobile money was a new concept to some, training was provided on how mobile cash works; for example, how to withdraw money using their phones. Once this was set up, money was disbursed in monthly tranches to the affected population throughout the season, for an overall period of six months.

To check whether the mobile cash distribution had the intended effect, distributions were closely monitored. The aim was to trace the progress of the early action once implemented, and to evaluate the added value and lessons learned from each distribution. This showed that 80-90 per cent of beneficiaries were ‘satisfied’ or ‘very satisfied’ with the process of early cash distribution.

A post-distribution evaluation also indicated how people used their cash distributions, showing that more than 85 per cent of respondents used some of their money to buy basic food staples. This was confirmed by focus group discussions, in which participants explained that they spent the majority of their cash on white rice, generally to stock up in order to survive the coming months of drought. Households also used money to prepare for the start of the school year (14.2 per cent), for basic necessities (12.4 per cent), agricultural inputs (8.5 per cent), medicines (6.7 per cent) and agricultural equipment (2.7 per cent).

Some beneficiaries (30.9 per cent) spent part of their money on things besides daily household needs. These included house repairs, paying debts, reviving small businesses (e.g., purchasing raw materials) and non-essential items such as furniture. Around 5 per cent of respondents saved some of their money to serve as an emergency fund if further problems arose during the lean season.

Overall, the post-distribution monitoring shows that the early cash distributions were effective, and that beneficiaries put their cash to its intended uses.

Success stories from Welthungerhilfe’s early cash intervention

Some beneficiaries of this early action were happy to share their stories with the Welthungerhilfe team.

More information on our triggers can be found in the blog post Forecast-based Action intervention: early cash distribution to address food insecurity in the north-east of Madagascar and on Welthungerhilfe’s Madagascar project page, Development of Forecast-based Action mechanism addressing drought-induced food insecurity in Madagascar.

This blog was written by Julia Burakowski, advisor for forecast-based action (FbA), monitoring, evaluation, accountability and learning (MEAL) and communication at Welthungerhilfe. For more information on this work, please get in touch with Dominik Semet, FbA programme coordinator at Welthungerhilfe or Marlene Müller, head of programme at Welthungerhilfe Madagascar.