Rahat: Simplifying access to cash relief
In a community in southern Nepal, a UNICEF-supported initiative is harnessing the potential of blockchain technology to provide timely cash transfers to families in need
Mahottari, Nepal: At the height of the COVID-19 pandemic, when the lockdowns had hit the Nepali economy hard, shutting down businesses and employment opportunities, Rakhi Mandal from Jaleshwor Municipality in Mahottari District in Nepal’s southern plains was struggling to keep her household afloat.
Rakhi’s husband was among the thousands who had lost their jobs, and things were especially dire given that the couple did not own any land of their own. The longer the pandemic stretched on, the more difficult it became for Rakhi to ensure food and other basic necessities for her family of seven.
It was only in early 2023, however, that Rakhi learned about an innovative new cash support initiative that was being piloted in her area for vulnerable families.
This was the Rahat project, a collaboration between UNICEF and Rumsan to use blockchain technology to provide digital cash transfers to families in need.
Under the pilot programme, UNICEF had transferred the cash support to Jaleshwor Municipality, from where it was sent to families in the form of tokens for those with mobile phones, deposited directly into bank accounts where preferred, or claimed through QR code cards. Rakhi, for instance, had received a message on her phone informing her of the date and time for cash distribution, as well as an OTP number. She had simply presented herself at the municipality office on the given day, shown her OTP number to the official, and received the grant.
Rakhi says she was surprised at how little time it took.
“I had thought that it would take an entire day, so it was a pleasant surprise to have the cash in hand so quickly,” she says.
Rakhi also appreciated how discreet the process was. “It was like any visit to the municipality office, I didn’t have to justify to anyone why I was there.”
The 27-year-old says the support, worth NRs. 10,000 (approx. USD 76.21), has provided her some relief. With the additional cash, she hopes to purchase better, more nutritious food and clothes for her children.
Harnessing the power of tech
Rahat, a digital cash and voucher assistance (CVA) management system that uses mobile-based blockchain tokens to manage and monitor aid transactions for emergency response and recovery programs. It seeks to simplify the process of distributing cash assistance, and increase financial inclusion, accountability, and transparency.
While always useful, this can be crucial during emergencies when immediate access to cash relief can make an enormous difference in people’s lives.
Rumsan, a member of the Blockchain Cohort focused on financial inclusion, was selected by UNICEF’s Venture Fund to carry out the initiative in Jaleshwor, a flood-prone area that has been socially and economically impacted by the COVID-19 pandemic. The pilot is part of the Office of Innovation's exploration of how blockchain can improve Cash Transfer Programming, and its outcomes will inform future scaling approaches.