Why are we doing this?
What's the Situation in Lebanon?
Lebanon's currency crisis caused widespread poverty. Many expatriates are looking for ways to help, and sponsoring a family for a sustained period of time is a powerful way to help them land on their feet.
The Beirut blast claimed the lives of at least 200 people, injured more than 6,000, left nearly 300,000 homeless, and left an estimated 1,000 people with permanent disabilities. (World Bank)
The explosion caused between US$3.8 billion and US$4.6 billion in damage to physical stock. (World Bank)
Purchasing power of the Lebanese Pound (LBP) was reduced by about 80% between Oct 2019 and Oct 2020 (Reuters)
Capital controls blocked depositors from accessing their savings
Capital controls stopped expatriate remittances
Import costs prohibitive; nearly no local production
Middle class has become poor with those living below the poverty line increasing by ~27% to 55% of the population (per ESCWA)
Lower class has reached extreme poverty (28%, per ESCWA)
Hundreds of thousands of families in need not benefiting from any aid relief as of Nov 2020 (Siren)
Risk of end of subsidies for basic necessities will have catastrophic consequences (Reuters)
WFP issues early warning of food insecurity
40% of microfinance borrowers are unable to meet their basic needs (CGAP)
Lebanon is witnessing food poverty for the first time since the 1915 famine (CGAP)
Unclear when the situation is expected to improve and if this will become a protracted crisis
$200 in USD bills can net at least LBP 1,200,000 depending on market rates. This is a substantial income for a family in need and covers basic necessities:
This figure was informed in three ways:
The 2018 State of Safety Net report by the World Bank shows that Lebanon spent ~$160 per capita on social safety net in 2011 money
80% of microfinance borrowers spend less than 2,000,000 LBP per month
Why USD Bills?
An equivalent amount wired through bank transfers would only net LBP 780,000 at the official exchange rate of LBP 3,900 per USD. Hence the motivation to deliver the donations in USD bills so families can exchange them at market rates, rather than bank rates.
Why Unconditional Cash Assistance?
Many associations and NGOs deliver in-kind aid to Lebanon, such as the Lebanese Red Cross, Arcenciel, and the UNHCR, to name a few. Cash assistance complements in-kind services and has many advantages, and we're trying to scale it through worldwide peer-to-peer assistance. Cash assistance is provided unconditionally to empower families with choice and dignity.
"Giving aid directly in the form of cash is often a highly effective way to reduce suffering and empower those who receive it." (ACTED)
15%-20% increase in purchase power, even compared to vouchers (WFP)
75% of recipients in Lebanon and Jordan prefer cash (WFP)
Confer more dignity to recipient as they have freedom to choose (ACTED)
Generations-old tradition of expatriate remittances (World Bank)
There could be a safety risk with withdrawing cash that can be addressed with measures such as daytime withdrawals in public settings, smaller installments, etc.