FAO pledges to scale up direct use of digital financial transfers

22 February 2021, Rome – In another step towards creating a “digital FAO”, the Food and Agriculture Organization of the United Nations is committing to increasing by 50 percent its delivery of digital financial transfers and vouchers to beneficiaries.

As part of joining the Better Than Cash Alliance, FAO is also pledging to expand its use of digital payments in at least ten more of its Decentralized Offices.

Director-General QU Dongyu set these ambitious targets, while officially joining the Better Than Cash Alliance. The Alliance is a United Nations-hosted partnership of governments, companies and international organizations that accelerates the transition from cash to digital payments in a way designed to generate savings and boost transparency and efficiency while also reducing poverty and driving inclusive growth.

“We must make sure that farmers and rural population are empowered to participate in and benefit from the digital world,” said the Director-General. “This partnership is a signal of our commitment to leave no one behind. Cash in digitized form will open numerous doors for people engaged in small-scale agri-food activities and offer great benefits. It is a high road to resilience.”

“FAO’s announcement today is a landmark for the agriculture sector in emerging economies. FAO’s visionary leadership means that millions of small-holder farmers will now get the assistance they need more quickly, safely and transparently. It also means those farmers – many of whom are women – will have access to a wider range of related services to improve their livelihoods”, said Dr. Ruth Goodwin-Groen, Managing Director of the Better Than Cash Alliance. “We are delighted that FAO is joining other member UN agencies, including UNHCR, UNICEF and WFP, in their bold commitment to responsible digitization of financial transfers to those most in need. This is even more important now as the COVID-19 pandemic is increasing poverty and inequality.”

Under Director-General QU’s leadership, FAO is taking big steps to embrace and produce digital solutions, as they are destined to affect every actor in the global agri-food systems and can be designed to offer opportunities to address the challenges of poverty, hunger, inequality and climate change.

FAO already uses mobile money transfers. One example is in Somalia where its Mobile Money and Livelihood Assistance platform delivers cash directly to beneficiaries’ cell phones, allowing farming families to purchase goods and services they need most in their local markets. Recipients are registered with the use of biometric data, which is evolving into a voice-recognition system, making this a safer, cheaper and better targeted means of conveyance than physical delivery and distribution.

Joining the Better Than Cash Alliance represents a step change in scaling up such efforts on all levels, and participating in an exchange on best practices in a fast-moving sector.

The new partnership holds significant promise, as FAO has already reached more than 19 million people in 58 countries with cash and voucher programmes. In 2019 alone, FAO transferred almost $50 million – a bit under half in digital form – to 2.8 million beneficiaries in 29 countries.

As FAO’s field activities – aiming to strengthen the resilience of rural livelihoods to shocks by supporting productive investment in agriculture – tend to engage vulnerable people living in rural dispersed and remote areas with limited infrastructure access, its digitalization experiences and needs will complement those of other Alliance members.

On the ground

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