As beneficiaries of cash transfers navigate the stressors of everyday life during the COVID-19 pandemic and beyond, behavioral science can enhance the design and implementation of cash transfer programs to improve their impact.


Social protection systems are now more important than ever

The economic fallout of the COVID-19 pandemic has reemphasized the importance of social protection programs around the world. Low- and middle-income communities, many of which were already vulnerable before the pandemic, now face widespread unemployment. With children out of school across the world, previous and future gains in human capital are at risk. And prices for basic needs, such as food and cleaning supplies, have increased, even as incomes decline. The pandemic necessitates additional safety and health-related precautions, compounding already weighty cognitive burden on vulnerable populations as they try to manage the strain on their livelihoods.

In response, many governments are expanding cash transfer programs or developing new ones to meet their citizens’ new and evolving social protection needs. Cash transfers make up more than 30% of the global social protection response to the pandemic. To help target populations make the most of their cash, governments are increasingly using insights from behavioral science, the study of human behavior, to design and implement their transfer programs. Here are some takeaways from the ongoing use of behavioral science to optimize the outcomes of cash transfer programs:


Governments should ensure the burden of receiving cash does not fall on beneficiaries

In order to receive their funds, cash transfer recipients often need to go through multi-step administrative processes, providing sets of data and documents to register and be validated. Such procedural hurdles can place additional burdens on vulnerable populations or even lead to their exclusion, since they are more likely to have time constraints and/or lack the required documentation.

Governments can implement creative validation strategies to make sure the cash gets to the right hands, while still shifting the burden away from the recipients. For example, the government of Kenya has been able to expand the reach of cash transfers by sharing data among government and nongovernmental agencies to more precisely target new beneficiaries. They also utilized the help of village elders to validate potential recipients.

Recipients, especially those receiving transfers for the first time and who are underestimating the potential impact of the pandemic, might perceive the transfer as a windfall and spend it accordingly.

It is important to frame cash transfers in a way that communicates their intended use. Research from behavioral science has shown that simply naming cash transfers for their purpose -- for example, an “education cash transfer” or “health care cash transfer” -- influences how recipients spend the money.

Similarly, COVID-19 support payments that are called “rent support cash transfers” or “cash transfers for food and cleaning supplies” can encourage recipients to anticipate and spend toward those needs. Part of this could also include sharing short rules-of-thumb with recipients for how they might spend the cash, such as, “Make sure your family has food and medicine for 2 weeks and saves the rest as a lifeline.” This will help recipients make the most of their money and ensure they are prepared for contingencies.


Beneficiaries who plan out in advance how to use the cash are more likely to avoid temptation spending

Including prompts at the time of payment to help recipients plan for how they will spend the cash -- for example, a poster or a text message that instructs recipients to list their immediate and future needs along with associated costs, and to decide which of those needs they will cover with the transfer.

Evidence from behavioral science shows that making plans and tracking expenses are effective ways for beneficiaries to avoid impulsive purchases and make sure their spending decisions are aligned with their priorities. Prompts that are delivered in a contextualized manner can help recipients take some time to reflect on their needs and goals prior to receiving the cash, plan for their spending, and then track their follow-through.


The expansion of cash transfers will likely continue beyond the duration of the pandemic

While each country will determine whether and how to use cash transfers based on its own circumstances, the pandemic has magnified the case for expanding access to social protection, whether through social insurance, non-contributory cash transfers or market-based approaches.

COVID-19 has highlighted the vulnerabilities of “the missing middle” – for example, informal workers who may not have been targeted by government-run cash transfer programs before this year, but have become much more visible due to the pandemic’s dramatic impacts on their livelihoods. As governments try to secure long-term social protection for this group, new insights will likely emerge about how informal workers engage with social protection and its benefits. Implementers should continue to look to behavioral science to design and test programs that address any barriers.


Design elements of digital payments will also need to account for human behavior

With face-to-face transactions limited amid the pandemic, the use of digital payments is increasingly considered as a safe, transparent and timely way to deliver funds. For those who lack easy access to physical bank branches, digital payments have the added benefit of connecting them to financial services. Yet, while digital payments hold great potential for financial inclusion, this mode of delivering cash transfers can also create a new set of challenges for beneficiaries who are new to the technology. Here, too, insights from behavioral science can help governments design the digital payment process in a way that anticipates barriers.



By analyzing the process of accessing cash transfers from the recipient’s point of view, behavioral science helps governments preemptively address any potential barriers. Grounded in evidence-based design, the behavioral design method incorporates contextualized solutions alongside testing for feasibility and applicability. Through the behavioral design process, program designers and implementers can minimize their costs, shift any burdens that may have unintentionally been placed on recipients, and better position beneficiaries to spend the cash in line with their goals while engaging with complementary services.

To find out more about behavioral design solutions and cash transfers, visit


“This blog post is published as part of the activities to promote and disseminate the results and key discussions of the global e-Conference ‘Turning the COVID-19 crisis into an opportunity: What’s next for social protection?’, held in October 2020. The blog summarises the key messages from the e-Conference’s Side Event on the role of behavioral science in social protection cash transfers during the COVID-19 era and beyond. The speakers were Saugato Datta, Managing Director at ideas42; Laura B. Rawlings, Lead Economist at the World Bank; and John Gachgi, Director at Social Assistance Unit, Ministry of Labour & Social Protection (Kenya); and Jessica Jean-François, Vice President at ideas42. You can watch the full session here”.



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ideas42 (2019). Cash and Change: Using Behavioral Insights to Improve Financial Health in Three Cash Transfer Programs. Retrieved from ideas42: