Using Technology to Deliver Social Protection: Exploring Opportunities and Risks

Stephen Devereux, Katharine Vincent
2010

Summary

What are the opportunities and risks of using information and communications technology (ICT) to deliver social protection? This article considers experiences from southern Africa, focusing on pilot projects in Malawi. It finds that using ICT to deliver social protection increases project efficiency and cost-effectiveness (particularly at large scale), increases flexibility and broader access to banking facilities for beneficiaries, and can especially empower women. It can also bring wider benefits to the national economy. With effective strategies in place to address risks such as information regulations and data security, the opportunities of ICT use can significantly outweigh the risks.

As the popularity of cash transfers continues to grow within the provision of social protection, there is an increasing need to ensure that delivery systems are cost-effective, timely, and secure. In the past, beneficiaries have been required to come to a specified pay-point at a specific time and date to collect their transfers. However these delivery systems can be prohibitively costly, reflecting the high risk of cash storage and transportation.

Smart cards, cell phones, mobile ATMs, GPS devices, and biometrics are among the technologies that have been piloted in Africa to try to improve the delivery of cash transfers. One such pilot was designed and delivered by Concern Worldwide in Malawi in 2006-2007. The Dowa Emergency Cash Transfer project (DECT) was a humanitarian response to food crisis. It adjusted the size of monthly cash transfers in line with food prices to protect recipients against hunger-season inflation. Recipients accessed cash from mobile banks using smart cards with biometric registration and verification. This increased project cost-effectiveness, efficiency, and safety. In addition, women were empowered as they were nominated to collect the cash. Women gained:

  • Access to formal banking services: the smart cards could be used at bank ATMs
  • Greater self-esteem: for many, possession of the smart card was their first official recognition, and it also gave them some social status within their communities.

The use of ICT in delivering social protection can also deliver wider benefits to a country’s economy. Projects using ICT increase the access of vulnerable populations to technology, and increase the ease with which other services are made available. This helps developing countries to leapfrog the digital divide.

There are risks to ICT use that need to be addressed. These relate to information regulations and the control of computerised databases, and to the potential for political or commercial manipulation of recipients’ details. However, positive evaluations of pilot schemes suggest that, with correct risk management, opportunities can far outweigh the risks. Key policy implications are that:

  • The high input costs of technology-based delivery systems mean that they are best suited for use at large scale, and their cost-efficiency depends on synergistic use of the range of benefits available with the technology in question.
  • Although technology can assist with the effectiveness of the delivery system, other aspects, such as correct registration and accurate targeting, are also required to ensure the success of social protection programmes.

Source

Devereux, S. and Vincent, K., 2010, 'Using Technology to Deliver Social Protection: Exploring Opportunities and Risks', Development in Practice, vol. 20, no. 3, pp. 367-379