GiveDirectly

Last updated

GiveDirectly
Founded2008;17 years ago (2008)
Type 501(c)(3) non-profit organization [1]
PurposeAlleviating extreme poverty through cash transfers
Location
Area served
Bahamas, Bangladesh, DRC, Liberia, Kenya, Malawi, Morocco, Mozambique, Nigeria, Rwanda, Togo, Turkey, Uganda, USA, Yemen
President
 Nick Allardice
EmployeesApprox 175 [2]
Website givedirectly.org

GiveDirectly is a nonprofit organization operating in low income areas that helps families living in extreme poverty by making unconditional cash transfers to them via mobile phone. GiveDirectly transfers funds to people in Bahamas, Bangladesh, DRC, Liberia, Kenya, Malawi, Morocco, Mozambique, Nigeria, Rwanda, Togo, Turkey, Uganda, USA, and Yemen.

Contents

History

GiveDirectly originated as a giving circle started by Paul Niehaus, Michael Faye, Rohit Wanchoo, and Jeremy Shapiro, students at MIT and Harvard, based on their research into philanthropy. [3] In 2012 they formalized their operation into GiveDirectly. [3]

In December 2012, GiveDirectly received a $2.4M Global Impact Award from Google. [4] In June 2014, the founders of GiveDirectly announced plans to create a for-profit technology company, Segovia, aimed at improving the efficiency of cash transfer distributions in the developing world. [5] [6] [7] In August 2015, GiveDirectly received a $25M grant from Good Ventures. [8]

In April 2016, GiveDirectly announced a $30M initiative to test universal basic income in order to "try to permanently end extreme poverty across dozens of villages and thousands of people in Kenya by guaranteeing them an ongoing income high enough to meet their basic needs" and, if it works, pave the way for implementation in other regions. [9] The initiative launched in November 2017 and is set to run for 12 years. [10]

In 2017, GiveDirectly applied their model for the first time in the U.S., distributing cash-loaded debit cards to residents of Rose City, Texas, following Hurricane Harvey. [11]

In 2022, GiveDirectly appointed British politician and diplomat Rory Stewart as their president. [12]

In 2023, an investigation revealed that in the Democratic Republic of Congo, where GiveDirectly began operations in 2018, employees had diverted at least $900,000 from several hundred intended recipients in South Kivu to themselves, including the very audit teams tasked with identifying such cases. GiveDirectly paused its operations in the country in January 2023 and began an audit of its funds transfers in another African country. [13]

Operations

COVID-19 support

GiveDirectly set up two emergency response programs to the COVID-19 pandemic: one in the US, for which it has raised US$118 million, and one in African countries, for which it has raised US$76 million. The organization has sent cash relief to 116,000 families in the US and 342,000 families in Kenya, Liberia, Malawi, Rwanda and Togo. [14]

In Togo it built on an existing government of Togo cash transfer program called Novissi. Money is paid via mobile money technology, with beneficiaries withdrawing money at local shops. GiveDirectly helped expand the program to certain rural areas where the government found it difficult to identify the poorest beneficiaries. [15] The machine learning algorithm First, it finds the poorest villages by analyzing roof material, sizes of farm plots and the presence of paved or unpaved roads through satellite images. Second, it finds the poorest individuals in a village by analyzing their mobile phone data like lengths and frequency of phone calls, number of inbound versus outbound calls, and amount of mobile data used. [16]

Basic income experiment

In April 2016 GiveDirectly announced a 12-year experiment to test a universal basic income on a rural region in Western Kenya. [17] [18] More than 26,000 people will receive some type of cash transfer, with more than 6,000 receiving a long-term basic income.

In November 2019, an economics paper on the GiveDirectly experiment found each dollar from cash transfers increased local economic activity by $2.60. [19]

Mission in Rwanda

Since 2016, GiveDirectly has been working in partnership with the Government of Rwanda, through the Ministry of Local Government (MINALOC), to accelerate poverty reduction. The organization delivers unconditional cash transfers to individuals living in poverty, empowering them with the means to choose how best to improve their lives. [20]

As of 2024, GiveDirectly has provided cash transfers to over 200,000 households across various districts, including Gasabo, Gicumbi, Gisagara, Kayonza, Ngoma, Ngororero, Nyamagabe, and Rusizi. Notably, 84% of these households are female-led. [21]

In 2023, GiveDirectly launched a national scale-up program, beginning with pilot projects in Gikomero, Cyabakamyi, Murama, Shingiro, and Butare districts. Under this initiative, eligible households receive a minimum of Rwf 1.1 million to support sustainable livelihoods and facilitate graduation out of poverty. [22]

Impact assessments in districts such as Nyamagabe, Ngororero, and Gisagara have shown that recipients commonly invest in productive assets such as agriculture, livestock, businesses, and education. Approximately 31% of funds are used for home renovations, while 43% support income-generating activities. Additionally, cash transfers have contributed to food security, health insurance participation, and electrification of homes. [23]

Through collaboration with local leadership and in-person engagement with households, GiveDirectly ensures effective implementation and addresses challenges during the process. The organization’s efforts align with Rwanda’s National Strategy for Sustainable Graduation out of Poverty (NSSG). [24]

Funding

GiveDirectly collects donations from private donors as well as foundations. [25] In 2015, the organization received $25 million from Good Ventures, a private foundation started by Facebook co-founder Dustin Moskovitz and his wife Cari Tuna. [26] In 2019, the organization won a grant of $2.1m from the Global Innovation Fund. [27]

Reception

GiveWell reviews

GiveDirectly has been named one of GiveWell 'top rated' charities for 2012 [28] [29] through 2020. [30]

Reception by development economists

After the release of GiveDirectly's impact self-evaluation in October 2013, [31] World Bank economist David McKenzie praised the robustness of the study's design and the clear disclosure of the study lead's conflict of interest, but raised two concerns: [32]

Chris Blattman, an academic in development economics, with a particular focus on randomized controlled trials, also blogged about the study. He expressed two main reservations: [33]

See also

Related Research Articles

<span class="mw-page-title-main">Extreme poverty</span> Condition characterized by severe deprivation of basic human needs

Extreme poverty is the most severe type of poverty, defined by the United Nations (UN) as "a condition characterized by severe deprivation of basic human needs, including food, safe drinking water, sanitation facilities, health, shelter, education and information. It depends not only on income but also on access to services". Historically, other definitions have been proposed within the United Nations.

<span class="mw-page-title-main">Poverty</span> Lack of financial assets or possessions

Poverty is a state or condition in which an individual lacks the financial resources and essentials for a basic standard of living. Poverty can have diverse environmental, legal, social, economic, and political causes and effects. When evaluating poverty in statistics or economics there are two main measures: absolute poverty which compares income against the amount needed to meet basic personal needs, such as food, clothing, and shelter; secondly, relative poverty measures when a person cannot meet a minimum level of living standards, compared to others in the same time and place. The definition of relative poverty varies from one country to another, or from one society to another.

<span class="mw-page-title-main">Welfare spending</span> Means-oriented social benefit

Welfare spending is a type of government support intended to ensure that members of a society can meet basic human needs such as food and shelter. Social security may either be synonymous with welfare, or refer specifically to social insurance programs which provide support only to those who have previously contributed, as opposed to social assistance programs which provide support on the basis of need alone. The International Labour Organization defines social security as covering support for those in old age, support for the maintenance of children, medical treatment, parental and sick leave, unemployment and disability benefits, and support for sufferers of occupational injury.

Guaranteed minimum income (GMI), also called minimum income, is a social-welfare system that guarantees all citizens or families an income sufficient to live on, provided that certain eligibility conditions are met, typically: citizenship and that the person in question does not already receive a minimum level of income to live on.

<span class="mw-page-title-main">Poverty reduction</span> Measures to reduce poverty permanently

Poverty reduction, poverty relief, or poverty alleviation is a set of measures, both economic and humanitarian, that are intended to permanently lift people out of poverty. Measures, like those promoted by Henry George in his economics classic Progress and Poverty, are those that raise, or are intended to raise, ways of enabling the poor to create wealth for themselves as a conduit of ending poverty forever. In modern times, various economists within the Georgism movement propose measures like the land value tax to enhance access to the natural world for all. Poverty occurs in both developing countries and developed countries. While poverty is much more widespread in developing countries, both types of countries undertake poverty reduction measures.

Opportunity International is a 501(c)(3) nonprofit organization chartered in the United States. Through a network of 47 program and support partners, Opportunity International provides small business loans, savings, insurance and training to more than 14 million people in the developing world. It has clients in more than 20 countries and works with fundraising partners in the United States, Australia, Canada, Germany, Switzerland, Singapore, Hong Kong and the United Kingdom. Opportunity International has 501(c)(3) status as a tax-exempt charitable organization in the United States under the US Internal Revenue Code.

<span class="mw-page-title-main">Bolsa Família</span> Government social welfare program in Brazil

Bolsa Família is the current social welfare program of the Government of Brazil, part of the Fome Zero network of federal assistance programs. Bolsa Família provided financial aid to poor Brazilian families. In order to be eligible, families had to ensure that children attend school and get vaccinated. If they exceeded the total of permitted school absences, they were dropped from the program and their funds were suspended. The program attempted to both reduce short-term poverty by direct cash transfers and fight long-term poverty by increasing human capital among the poor through conditional cash transfers. It also worked to give free education to children who couldn't afford to go to school, to show the importance of education. In 2008, The Economist described Bolsa Família as an "anti-poverty scheme invented in Latin America [which] is winning converts worldwide." The program was a centerpiece of former president Luiz Inácio Lula da Silva's social policy and is reputed to have played a role in his victory in the general election of 2006. Bolsa Família was the largest conditional cash transfer program in the world, though the Mexican Oportunidades was the first nationwide program of this kind.

Conditional cash transfer (CCT) programs aim to reduce poverty by making welfare programs conditional upon the receivers' actions. The government only transfers the money to persons who meet certain criteria. These criteria may include enrolling children into public schools, getting regular check-ups at the doctor's office, receiving vaccinations, or the like. CCTs seek to help the current generation in poverty, as well as breaking the cycle of poverty for the next through the development of human capital. Conditional cash transfers could help reduce feminization of poverty.

<span class="mw-page-title-main">Charity (practice)</span> Voluntary giving of help to those in need

Charity is the voluntary provision of assistance to those in need. It serves as a humanitarian act, and is unmotivated by self-interest. Various philosophies about charity exist, with frequent associations with religion.

<span class="mw-page-title-main">Poverty in China</span>

In China, poverty mainly refers to rural poverty. Decades of economic development has reduced urban extreme poverty. According to the World Bank, more than 850 million Chinese people have been lifted out of extreme poverty; China's poverty rate fell from 88 percent in 1981 to 0.7 percent in 2015, as measured by the percentage of people living on the equivalent of US$1.90 or less per day in 2011 purchasing price parity terms, which still stands in 2022.

A social safety net (SSN) consists of non-contributory assistance existing to improve lives of vulnerable families and individuals experiencing poverty and destitution. Examples of SSNs are previously-contributory social pensions, in-kind and food transfers, conditional and unconditional cash transfers, fee waivers, public works, and school feeding programs.

A cash transfer is a direct transfer payment of money to an eligible person. Cash transfers are either unconditional cash transfers or conditional cash transfers. They may be provided by organisations funded by private donors, or a local or regional government.

<span class="mw-page-title-main">Universal basic income</span> Welfare system of unconditional income

Universal basic income (UBI) is a social welfare proposal in which all citizens of a given population regularly receive a minimum income in the form of an unconditional transfer payment, i.e., without a means test or need to perform work. In contrast, a guaranteed minimum income is paid only to those who do not already receive an income that is enough to live on. A UBI would be received independently of any other income. If the level is sufficient to meet a person's basic needs, it is sometimes called a full basic income; if it is less than that amount, it may be called a partial basic income. As of 2024, no country has implemented a full UBI system, but two countries—Mongolia and Iran—have had a partial UBI in the past. There have been numerous pilot projects, and the idea is discussed in many countries. Some have labelled UBI as utopian due to its historical origin.

<span class="mw-page-title-main">Benazir Income Support Programme</span> Poverty reduction programme in Pakistan

The Benazir Income Support Programme (BISP) is a federal unconditional cash transfer poverty reduction program in Pakistan. Launched in July 2008, it was the largest single social safety net program in the country with nearly Rs. 90 billion distributed to 5.4 million beneficiaries in 2016.

In Brazil, universal basic income has been discussed at least since the 1980s. In 2001 a law was introduced by Senator Eduardo Suplicy of the Brazilian Workers Party which mandated the progressive institution of such a welfare system. By this move Brazil became the first country in the world to pass such a law. Suplicy had previously introduced a bill to create a negative income tax, but that bill failed to pass. The new bill called for a national and universal basic income to be instituted, beginning with those most in need. The bill was approved by the Senate in 2002 and by the Chamber of Deputies in 2003. President Lula da Silva signed it into law in 2004, and according to the bill it is the president's responsibility to gradually implement the reform. Since then Brazil has started to implement the bill through the Bolsa Família program, which was a centerpiece of President Luiz Inácio Lula da Silva's social policy, and is reputed to have played a role in his victory in the Brazilian presidential election, 2006.

Universal basic income in India refers to the debate and practical experiments with universal basic income (UBI) in India. The greatest impetus has come from the 40-page chapter on UBI that the Economic Survey of India published in January 2017. It outlined the three themes of a proposed UBI programme:

Unconditional cash transfer (UCT) programs are philanthropic programs that aim to reduce poverty by providing financial welfare without any conditions upon the receivers' actions. This differentiates them from conditional cash transfers where the government only transfers the money to persons who meet certain criteria. Unconditional cash transfers have developed on the premise that giving cash to citizens allows them to have autonomy over their own lives.

Universal basic income pilots are smaller-scale preliminary experiments which are carried out on selected members of the relevant population to assess the feasibility, costs and effects of the full-scale implementation of universal basic income (UBI), or the related concept of negative income tax (NIT), including partial universal basic income and similar programs. The following list provides an overview of the most famous universal basic income pilots, including projects which have not been launched yet but have been already approved by the respective political bodies or for the negotiations are in process.

Quatinga Velho, or the Consortiun of Basic Income of Citizenship, is an independent basic income pilot conducted by the NPO ReCivitas who experienced payment of an unconditional basic income via direct democracy and funded by direct donations from people around the world. Basic income charity is run in the small community of Quatinga Velho in Brazil.

<span class="mw-page-title-main">The BOMA Project</span>

BOMA is a U.S. nonprofit organization and Kenyan NGO that works to provide poor women living in the arid and semi-arid lands of Northern Kenya with the educational, financial, and technological resources to lift themselves out of poverty. Its mission is to “empower women in the drylands of Africa to establish sustainable livelihoods, build resilient families, graduate from extreme poverty and catalyze change in their rural communities.”

References

  1. ↑ "GiveDirectly". GiveDirectly. Retrieved November 30, 2012.
  2. ↑ "GiveDirectly team page".
  3. 1 2 Goldstein, Dana (December 21, 2012). "Can 4 Economists Build the Most Economically Efficient Charity Ever?". The Atlantic.
  4. ↑ "Google Dot Org". www.google.org. Archived from the original on January 6, 2017. Retrieved January 25, 2017.
  5. ↑ Hassenfeld, Elie (June 20, 2014). "Update on GiveDirectly". GiveWell . Retrieved May 2, 2020.
  6. ↑ Coleman, Isobel (June 20, 2014). "Segovia: A New Player in Cash Transfers". Development Channel blog, Council on Foreign Relations . Retrieved June 21, 2014.
  7. ↑ "GiveDirectly - August 2014 Update". August 2014. Retrieved May 2, 2020.
  8. ↑ "Blog | GiveDirectly". www.givedirectly.org. Retrieved May 2, 2020.
  9. ↑ "What If We Just Gave Poor People a Basic Income for Life? That's What We're About to Test". Slate. April 14, 2016. Retrieved May 2, 2020.
  10. ↑ "The largest basic income experiment in history just launched in Kenya". Business Insider. Retrieved January 17, 2018.
  11. ↑ "After Harvey, One Group Is Hoping Giving Away Cash Will Help Houstonians Rebuild". NPR News. Retrieved January 17, 2018.
  12. ↑ Brown, Will (September 18, 2022). "This man wants to give $1,000 to every poor person on Earth – but could his plan really work?". Daily Telegraph. Retrieved June 10, 2023.
  13. ↑ Harriet Barber (June 9, 2023). "Rory Stewart's 'GiveDirectly' charity defrauded of almost $1m in Congo". Daily Telegraph. Retrieved June 10, 2023.
  14. ↑ Samuel, Sigal (December 1, 2020). "Is the pandemic making people more generous — or more selfish?". Vox. Retrieved December 29, 2020.
  15. ↑ Gharib, Malaka (February 15, 2021). "The Pandemic Pushed This Farmer Into Deep Poverty. Then Something Amazing Happened". NPR News. Retrieved February 15, 2021.
  16. ↑ Visram, Talib (December 11, 2020). "How GiveDirectly is finding the poorest people in the world—and sending them cash". Fast Company. Retrieved December 29, 2020.
  17. ↑ "What Would Happen If We Just Gave People Money?". FiveThirtyEight. April 25, 2016. Retrieved May 2, 2020.
  18. ↑ "Charity To Amp Up Direct Aid Mission In Impoverished East Africa". NPR News. Retrieved January 25, 2017.
  19. ↑ Miguel, Edward; Egger, Dennis; Haushofer, Johannes; Niehaus, Paul; Walker, Michael (November 21, 2019). "General equilibrium effects of cash transfers: experimental evidence from Kenya" (PDF). Berkley.edu. Retrieved May 2, 2020.
  20. ↑ "Can Rwanda evolve into a poverty-free country? GiveDirectly's mission to accelerate poverty reduction in Rwanda". The New Times. February 15, 2024. Retrieved January 15, 2025.
  21. ↑ "Can Rwanda evolve into a poverty-free country? GiveDirectly's mission to accelerate poverty reduction in Rwanda". The New Times. February 15, 2024. Retrieved January 15, 2025.
  22. ↑ "Can Rwanda evolve into a poverty-free country? GiveDirectly's mission to accelerate poverty reduction in Rwanda". The New Times. February 15, 2024. Retrieved January 15, 2025.
  23. ↑ "Can Rwanda evolve into a poverty-free country? GiveDirectly's mission to accelerate poverty reduction in Rwanda". The New Times. February 15, 2024. Retrieved January 15, 2025.
  24. ↑ "Can Rwanda evolve into a poverty-free country? GiveDirectly's mission to accelerate poverty reduction in Rwanda". The New Times. February 15, 2024. Retrieved January 15, 2025.
  25. ↑ "Group gives cash aid to rural Kenyans, then studies its effects". PBS NewsHour. April 8, 2017. Retrieved January 4, 2018.
  26. ↑ Dolan, Kerry A. "Facebook Billionaire's Good Ventures Donates $25 Million To GiveDirectly, Which Gives Cash To The Very Poor". Forbes. Retrieved January 4, 2018.
  27. ↑ "GiveDirectly". Global Innovation Fund. Retrieved October 20, 2023.
  28. ↑ Karnofsky, Holden (November 26, 2012). "Our Top Charities for the 2012 Giving Season". GiveWell. Retrieved May 2, 2020.
  29. ↑ "Top charities - November 2012 archived version". GiveWell. November 2012. Retrieved May 2, 2020.
  30. ↑ "Our Top Charities - September 2020 Version". November 2019. Retrieved October 6, 2021.
  31. ↑ Haushofer, Jonathan; Shapiro, Jeremy (October 24, 2013). "Policy Brief: Impacts of Unconditional Cash Transfers" (PDF). Archived from the original (PDF) on October 29, 2013. Retrieved October 26, 2013.
  32. ↑ McKenzie, David (October 27, 2013). "Some thoughts on the Give Directly Impact Evaluation". World Bank . Retrieved November 28, 2015.
  33. ↑ Blattman, Chris (October 25, 2013). "And the cashonistas rejoice" . Retrieved November 28, 2015.
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