COVID-19: Why cash + community is critical

Unbound finds its use of cash transfers and community building critical for being able to respond quickly to the needs of the families in their programs during the COVID-19 pandemic.

In El Salvador, government officials recently approved COVID-19 funding for families, but there was one problem: local estimates indicated that 75 percent of the people who qualified for the support did not have a bank account.

The problem in El Salvador underscores a global challenge as rich and poor nations around the world scramble to find ways to support their most vulnerable citizens during the pandemic. Many countries are looking to use cash transfers to deliver direct support, but are finding that some of their most vulnerable citizens face barriers to financial services that make them more difficult to reach at a time when their need for support is even more urgent.

Unbound, the international nonprofit working with more than 300,000 families living in extreme poverty across Africa, Latin America and Asia, started using cash transfers to deliver support to families in 2001. Currently, 93 percent of children, youth and elders participate in Unbound programs that use cash transfers as the primary method for delivering benefits. Unbound credits its use of the transfers and virtual banking platforms for being able to respond quickly to the needs of the families in their program during the COVID-19 pandemic.

“We are all seeing some of the challenges of the traditional banking model as the U.S. government must write and mail physical COVID-19 relief checks to so many Americans,” said Dan Pearson,  director of international programs at Unbound. “The trend toward virtual banking platforms and other non-traditional banking instruments precedes the COVID-19 pandemic, but the current crisis is clearly accelerating the trend. These trends are hopeful for us because the traditional banking models have done a poor job of including the poorest and most vulnerable.”

In El Salvador, approximately 10,000 Unbound families recently were able to receive government subsidies in light of COVID-19 thanks to their bank accounts opened through the Unbound program.

Currently, 93 percent of children, youth and elders participate in Unbound programs that use cash transfers as the primary method for delivering benefits.

“Unbound families had access to their subsidy funds within hours of applying, whereas the general population without bank accounts had to follow a process that involved days of multiple long waits at public and financial institutions,” Yessenia Alfaro, coordinator for Unbound’s program in El Salvador, said. Congregating in long lines during a pandemic is especially dangerous, forcing a difficult choice between social distancing and getting access to needed support.


According to Alfaro, the families’ familiarity with the banking system has allowed them to navigate the process of claiming their subsidies smoothly and with more confidence than those who did not already have the accounts.

Thousands of families supported through Unbound around the world, including in countries like Colombia and Kenya where mobile phone access is cheap and robust, receive a text message to their mobile phones when sponsorship money has been deposited in their accounts.

While cash transfers play a large role in Unbound’s success responding to the COVID-19 pandemic, the nonprofit also credits its use of thoughtful community building to making the response even easier and more impactful.

Unbound has trained and organized more than 10,000 mothers groups in the countries where it works. Since local Unbound staff are not able to visit the families at this time, mothers group leaders report updates on the latest needs of families in the neighborhood. The peer support has been invaluable as families seek to navigate their local financial system and access resources. The mothers groups are sharing words of encouragement and sometimes even sharing scarce food resources.

In April, Unbound announced it had sent more than $8 million in direct support to families in its programs. In times of crisis, cash is king. But the current crisis highlights a broader truth. During and after this crisis cash transfers are the best way to provide immediate support in a way that each family can tailor to meet their unique needs.

Learn about five dynamics of Unbound programs that help the organization respond in the COVID-19 crisis.

How you can help in the pandemic

Your gift to the Disaster Response fund helps families most affected by the COVID-19 crisis. Cash transfers are made to the individual bank accounts where families receive their Unbound benefits. This gives families the most flexibility to address urgent needs while doing their part to stay healthy and keep their communities safe.