Customized Cash Transfers: Financial Lives and Cash-flow Preferences in Rural Kenya

We examine the preferences of low-income households in Kenya over the structure of unconditional cash transfers. We find, first, that most prefer lumpier transfers, and many prefer delayed receipt—unlike the structures typical of safety-net programs, but consistent with evidence on the financial challenges of poverty. Second, poverty itself affects preferences: a little more financial slack when deciding increases desired delay. Finally, financial slack pays back: some delay—aligning transfers better with the seasonal cycle—increases deliberation, income, and goal progress 1.5 years later. Adapting cash transfer design to recipients’ decision-making environment could improve their financial choices and outcomes.