Once the decision to use CBI is made, the modality is chosen (cash or voucher). It is possible to choose a mixture of different modalities in the same project at the same time or to have a change of modality during the implementation phase. The decision for the modalities depends on assessment and analysis activities, and consultation with the targeted communities.
The following decision tree can be useful to determine whether CBI is a feasible modality of assistance and which is the most appropriate type. It is meant as a guide to illustrate the decision and it is important to consider the local context when making the final decision.
4.2.1 Advantages and disadvantages of different assistance modalities
Each modality has its own advantages and disadvantages. These are summarised in the table below. In addition to this table, there is a scoring tool to assess advantages and disadvantages of modalities based on the context.
Decision making scoring (modality or mechanism) template
4.2.2 Choosing the delivery mechanism: Delivery Mechanism Matrix
The Delivery Mechanism Matrix Tool can support you in the CBI programme cycle because it is useful for selecting a delivery mechanism. The Excel document is designed to be printed on eight pages and is organised along the following programme cycle steps: specifications, risks, mitigation measures, preconditions, implications to operations and checklists depending on the delivery mechanism used (cash in envelope, direct cash as a check, mobile money, paper or e-voucher, debit or ATM card, smart card, etc.).
Figure 6: Modality Decision Tree
Adapted from the Mercy Corps’ “Cash Transfer Programming Toolkit” as well as the International Committee of the Red Cross and Red Crescent’s “Cash Transfer Programming SOP”. The Cash Transfer Programming (CTP) Toolkit is a basic guide to cash transfer programming in emergency response and early recovery settings.
Table 4: Advantages and Disadvantages of Assistance Modalities
| Modality | Advantages | Disadvantages |
|---|---|---|
| In-kind |
Useful when markets have been disrupted and/or required items are not available locally If items are available locally but at high prices, bringing in items in bulk may be cheaper Ensures beneficiaries receive the goods and services they are expected to access Facilitates the quality control of the items made available for beneficiaries. |
No freedom of choice May have high procurement, transportation and storage costs May undermine local markets Potential to cause deflation of prices High risk of corruption in large contracts with suppliers Requires greater accessibility to the area (e.g. trucks) May create or exacerbate stigma (beneficiaries queuing or being pointed out as poor) |
| Cash transfers |
Quick to distribute and cash can be spent where and on what beneficiaries choose Minimal administrative burden Can be given to moving populations, and more flexible if made accessible to persons with disabilities, particularly women and girls Can be used for a range of objectives and result in increased access to goods, services, labour opportunities or rebuilding of housing or infrastructure |
Risks of leakage and theft during payment or transfer process Can be difficult to target due to popularity May be used for anti-social purposes May not address the causes of vulnerability and may encourage a return to negative coping strategies Cash transfers require adequate and accessible services or commodities to be available and of sufficient quality |
| Vouchers |
Encourages productivity and stimulates markets Allows tracking for theft Quality of goods and prices can be monitored Items purchased can be monitored If specific commodities are scarce, vouchers can ensure that everyone is able to access them Commodity vouchers protect recipients against inflation (which is then borne by the implementing organization) Allows for greater security for the implementing organization and recipient as no large amounts of cash are handled Increased accountability Limited security risks if shops are allocated a small number of recipients Can direct recipient choice |
Less applicable with moving populations Can limit recipient choice Requires more planning, preparation and administrative back-up Traders who are not involved in the programme may be disadvantaged Discounts are difficult to ensure through voucher programmes (unlike food distributions, where significant discounts can be expected because of bulk purchases and VAT refunds). As such, voucher programmes are often as expensive as, for example, food distributions |