Caritas India expands cash transfers to boost dignity and speed recovery

Aid agency says giving people direct cash, rather than goods, improves choice, strengthens local markets and shifts control from relief agencies to crisis-affected families.

NEW DELHI (Indian Catholic News) — Caritas India is expanding the use of cash-based assistance in humanitarian responses, arguing that direct cash transfers give disaster-affected families greater control over their recovery while strengthening local economies.

In a new internal document, Cash-Based Interventions: Experience from action, the Catholic humanitarian agency details how cash transfers are increasingly used as an alternative to traditional in-kind aid such as food parcels, shelter materials and household goods.

“Cash transfers are increasingly accepted as an alternative and meaningful way to assist people reeling from the impact of crisis,” said Fr Jolly, assistant executive director of Caritas India, in the introduction to the document. “Disasters are often related to poor people’s inability to access food and other needs due to lack of purchasing power, rather than an overall lack of availability.”

From goods to choice

The approach represents a significant shift in power, placing decision-making in the hands of programme participants rather than aid agencies, according to the report produced under the leadership of Fr Paul Moonjely, executive director, and Fr Jolly.

Cash-based interventions include unconditional cash grants, conditional cash transfers linked to specific activities, vouchers and cash-for-work programmes. The document says unconditional transfers allow households to meet urgent needs such as food, health care, school fees or shelter repairs without restrictions, while conditional programmes link payments to activities such as rebuilding homes or restoring community infrastructure.

Caritas India says cash is used where markets are functioning and goods are available locally, including after floods in Assam and Kerala and earthquakes in Manipur. Assessments of market access, safety and community preferences are used to determine whether cash is appropriate.

The agency says programmes are designed in consultation with communities and prioritise vulnerable groups, including single women, elderly people and persons with disabilities. Transfers are made through bank accounts, vouchers or direct cash, with monitoring systems in place to track use and gather feedback.

The organisation argues that cash improves efficiency by reducing transport and storage costs and avoiding situations where families sell unwanted in-kind aid at a loss. It also says cash injections can stimulate local markets, helping traders and service providers recover alongside affected households.

Rebuilding with dignity and cash

One example cited in the document comes from Odisha after Cyclone Phailin, where Caritas India used cash-for-work to support families while rebuilding community infrastructure such as roads and water ponds. The programme provided short-term income at a time when livelihoods had been disrupted.

Monitoring found that families used the money for school expenses, medicines, land rehabilitation and debt repayment. The programme also acted as a safety net, giving households the flexibility to prioritise their own needs.

In northeast India, direct cash transfers in Assam, Manipur and Mizoram since 2016 have focused on increasing purchasing power to meet basic needs and support livelihood recovery. The document notes that cash is often transferred into women’s bank accounts, increasing their role in household decision-making.

“The cash that I have received from Caritas India was very useful because I could buy the things that I really needed in running my family. Though the amount was small, but it mattered a lot when we really needed it,” said Kamlaysori Basumatary, a resident of Kokrajhar district in Assam, quoted in the report.

Caritas India also points to experiences in Tamil Nadu and Kerala, where conditional and unconditional cash transfers were used for shelter repair after floods. In Tamil Nadu, most shelter grants went to women, and beneficiaries were able to choose designs, materials and vendors.

Aid workers said families reported feeling treated as partners rather than passive recipients. The document notes that beneficiaries avoided long queues and gained greater bargaining power with suppliers.

While cash can provide rapid relief, Caritas India said it is not a standalone solution. The agency says longer-term recovery and rehabilitation programmes are needed to rebuild livelihoods and address deep-rooted vulnerability, particularly among Dalit and tribal communities.

Still, the organisation argues that cash-based programming marks a fundamental change in humanitarian practice.

“Cash provides assistance in a manner that enables people to make decisions about their own welfare,” the document said, describing the approach as more dignified, flexible and better aligned with real household priorities.