Cash Transfer Scheme Boosts Zimbabwe’s Rural Economy
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Published on 31 July 2014

Recipients of WFP's seasonal targeted assistance line up to receive EcoCASH payments in Gokwe South.

Copywright:WFP/Rachel Chavhi

Lower Gweru -  WFP is using cash and vouchers in Zimbabwe to tackle hunger where food is available in the market place but where most people cannot afford to buy. In the past, WFP handed out cash to beneficiaries waiting patiently in line. Nowadays, the organization transfers cash and food vouchers via mobile phone. This method is more convenient for the recipient and cheaper for WFP. It’s also a good way of injecting money into cash-poor areas.

Muchakata, a village in Chiwundura, is only accessible by a rough gravel road. It lies just 65 kms from Zimbabwe’s third city, Gweru, but like many other parts of the country, it has poor infrastructure, a limited electricity supply and mud roads which are at the mercy of the weather. Food is readily available but most people cannot afford to buy it. 

With little to sell and cash in short supply, life had become a hand-to-mouth struggle for many people including Senzeni Mabena (52), a mother of seven children. But that all changed, thanks to a partnership between WFP and EcoCASH – an innovative mobile payment solution that enables customers to complete simple financial transactions such as sending money and paying for goods and services.

During the last lean season, recipients of seasonal assistance including Senzeni received mobile transfers from WFP via mobile telephones. They could use these to withdraw cash from mobile money ‘agents’ (usually local traders) or to purchase commodities in selected shops.

The money, paid by the WFP every month at the height of the lean season, enabled Senzeni to buy maize, pulses and vegetable oil.

“We could have starved to death if we'd not received help," she said recently.

Launched this year in the drought-affected districts of Lower Gweru and Gokwe South, the mobile money transfer scheme is a unique initiative that combines cash with food rations. Over the course of the lean season, some 20,000 people were assisted. Overall, more than a million people throughout the country received seasonal targeted assistance from WFP during this time.

The idea is that recipients will use the money to buy corn from shops or farmers with surplus stock which is milled and cooked to make sadza, Zimbabwe’s staple. Not only does this give people the flexibility to buy where and from whom they choose. It also injects much-needed cash into the local economy.

In 2013, WFP transferred more than US$9 million through cash and voucher schemes to some 295,000 people. Plans are now underway to increase the amount distributed in this way to US$13 million.  

 

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About the author

Tomson Phiri

Public Information Officer

Tomson joined WFP in  2011