Cash grants have a huge impact in a crisis—and technology can make that impact even bigger
In times of crisis, people’s instinct to give time and money kicks into high gear. In fact, the vast majority of Americans who donated to charities in the first half of 2020 said they would continue to give the same amount or more, even as they tighten their belts elsewhere.
When it comes to a crisis like COVID-19 that has affected so many lives and livelihoods, the need for help from individuals and organizations can vastly outpace resources. Based on data nine months into the pandemic, the Center on Budget and Policy Priorities (CBPP) reports that one in six adults with children did not have enough food to feed their families in the previous week. The CBPP also found that 20% of renters were behind on their payments, and that over a third of Americans said they had trouble paying their basic expenses in the past week. All of this leaves people and companies asking: Where can our money do the most good?
While all generosity is needed and there are few wrong moves, there is one tool with a proven track record of success that I think should be given more consideration: giving people cash. At Google.org, Google’s philanthropy, we’ve been experimenting with direct cash assistance for nearly a decade, and, as part of our $100 million commitment to COVID-19 relief efforts, we tripled our funding to organizations who get cash directly in the hands of families who need it most.
More autonomy for recipients
Cash allows people to rebuild their lives on their own terms. GiveDirectly is a nonprofit that helped to start the direct cash movement when it launched back in 2008. (Note: I serve on GiveDirectly’s board.) This summer, Google.org, Google employees, additional foundations, and the public came together to raise over $180 million for GiveDirectly’s COVID-19 Relief Fund. Turns out, all that cash was pretty impactful. GiveDirectly was able to surpass its fundraising goal by 80% and put $1,000 into the hands of 154,000 families during a critical time of need. Allowing these families to use the money to meet their needs not only provided critical support, but also helped to restore a sense of ownership.
And the data shows that cash grants work. In a past GiveDirectly study, 84% of natural disaster victims said they preferred cash because of its flexibility and the sense of agency it provides. According to another, first-of-its-kind study Google.org conducted with USAID, families reported that they’ve been able to improve their children’s nutritional intake, upgrade the quality of their homes, and pay down debt with the help of lump sum cash transfers. Even more impressive to me is that the impact of cash grants has a ripple effect beyond any one family receiving cash. Initial studies have shown that direct cash assistance can help empower communities and local economies, not just individuals.
More confidence for donors
People want to find meaningful ways to support those in need, but they also want to know that their donations are going toward their intended purpose. Organizations like the National Domestic Workers Alliance (NDWA) help make that possible. Back in March, NDWA launched its Coronavirus Care Fund with the goal of raising $4 million from the public for domestic workers who were facing economic hardship and job instability due to the pandemic. They surpassed their fundraising goal—three times over.
As a result, they needed help getting the money into the right hands, fast. To help, Google.org deployed a team of Google employees through our Google.org Fellowship program to build a platform that allowed NDWA to quickly verify recipients and distribute emergency cash funds.
Through the use of technology like this, groups such as NDWA and GiveDirectly have been able to get much-needed cash into the hands of families quickly and with limited overhead. For example, in a recent study, more than 90% of GiveDirectly’s project funds went directly into the hands of recipients in Texas and Puerto Rico. Through cash giving, nonprofits can steer more of donors’ money directly to where it’s intended and, in return, donors can have more confidence that their dollars are going far.
If you’re a company looking to address the short and long-term impacts of COVID-19 and other crises, I’d encourage you to consider direct cash assistance. Similarly, if you’re an individual wondering: “Well, what can I do?”, consider donating to a nonprofit that supports direct cash transfers for families in your local community—your generosity could make all the difference.
Jacquelline Fuller is the President of Google.org.