The Government of India has been conducting pilots on alternate delivery mechanisms, including direct cash transfers. These pilots are expected to cut leakages, increase efficiency, and enable better targeting under the food security programs. MSC undertook a multidimensional assessment in 2019 to explore the impact of cash transfer on nutritional and health outcomes in the target populations.
About 245,000 households across three union territories in India have been receiving cash transfer benefits since 2015. The study revealed that the beneficiaries find the subsidy amount insufficient as rations purchased with the subsidy lasted for only two weeks. In contrast, the rations under the prior in-kind distribution system lasted three weeks. Moreover, the cash transfers had a negligible effect on the dietary diversity and quantity of food consumed due to a lack of nutritional literacy. The study also found that, typically, beneficiaries spent the cash subsidy on non-food expenses. The study was instrumental in identifying levers that can improve the design of cash transfer programs to improve nutritional outcomes across vulnerable communities.