Lump-sum or monthly? Understanding cash transfer timing
The case of farmer support in Northern Ghana
By Roxana Manea, , Paul Christian, ,
When supporting farmers in crisis-affected or low-resource settings, the challenge is often not only determining who should receive support or how much to provide, but also how and when to deliver it.
This question is especially relevant in places like Northern Ghana, where poverty levels are high and access to credit is limited. In such settings, small changes, such as the timing of cash transfers, may significantly enhance impact without raising costs. For example, lump-sum payments could help households make productive investments that aren’t possible with smaller, staggered transfers.
While this hypothesis is intuitive, causal evidence on the most effective timing and frequency of disbursements remains limited. Most studies compare recipients of cash transfers to non-recipients, leaving important questions about payment design unanswered.
Building on the well-established benefits of cash transfers, a key issue for WFP’s Farmer Support Activity programme — a USAID-funded initiative that seeks to enhance the productivity of smallholder farmers in Northern Ghana through cash-based transfers — was how to structure and time these payments to best support livelihoods and resilience without increasing costs.
Against this backdrop, WFP’s Office of Evaluation and the World Bank DIME Department partnered with the Ghana country office for a rigorous impact evaluation to test two different cash transfer schedules. The evaluation team randomly assigned one of the below payment schedules to 163 villages (with 3,250 smallholder farmers):
- Three smaller and equal monthly payments during the lean season, or
- One larger lump-sum payment at the beginning of the lean season.
Each farmer, across both groups, received around 3,500 Ghanaian cedis (USD315), with a focus on improving agricultural outcomes.
Takeaway 1: Lump-sum payments boost farmers’ crop cultivation activities
On average, lump-sum recipients cultivated 5 percent more land, used 18 percent more household labour, increased fertilizer expenditures by 7.5 percent, achieved 5 percent higher harvests, and generated 13 to 17 percent higher earnings from crop sales. The lump-sum group’s ability to purchase fertilizer in bulk at a critical time, as required for effective use, primarily drove this effect.
A farmer from the East Mamprusi district expanded his maize field — from the usual two or three acres to five — using the lump-sum payment to immediately plough, buy fertilizer and hire labour, something he said would not have been possible with smaller, incremental payments. In a focus group discussion, he said:
“If the money had come in small amounts, I would have spent it little by little on food, on small things. But this way, I was able to make a real investment.”
Others in his village echoed similar experiences, leading to better yields and higher revenues.
Take-away 2: Monthly payments diversify everyday spending
Another important takeaway is that monthly payments, while relatively less impactful for agricultural outcomes, encouraged more diversified spending. Households bought additional livestock, for instance 22 percent more cows, and owned more assets like phones and bikes. They were more likely to keep their children in school. They also took out more formal credit: 30 percent higher on average compared to lump-sum recipients.
Take-away 3: Lump-sum payments improve food security in the short run
Lump payments showed better short-term results, without harming long-term outcomes, demonstrating their net benefit at no additional cost to the programme. Over time, as the monthly group received more of their transfers, both groups reached similar levels of food security and psychosocial wellbeing. The graph below plots one such measure of food insecurity, i.e., the reduced Coping Strategies Index (rCSI), to showcase these insights (lower values indicate improved coping).
The study shows that while the monthly schedule led to diversified expenditure, the lump-sum payments were better suited to boost agricultural outcomes and food security. As WFP and other humanitarian actors and development partners, like the initiative’s donor, USAID, continue to seek cost-effective ways to optimize limited resources, evaluations that test programme strategies rather than overall impacts against a no-intervention counterfactual become increasingly important. Especially when linked to short-term outcomes, such evaluations can guide quick adjustments and improve overall effectiveness. This impact evaluation shows that, with minor adjustments, WFP can significantly enhance impact; and in many cases without incurring any additional costs.
The final report of this evaluation was published in July 2025
Building on the initial findings, the second phase of the impact evaluation introduces an important new layer: understanding how the size and frequency of transfers influence decision-making patterns, including investment decisions, among men and women. The evaluation will continue to compare lump-sum versus monthly disbursements, while also assessing whether impacts differ between men and women recipients and explore how cash transfers affect decision-making dynamics within households.
* The FSA programme in Northern Ghana was made possible with support from the U.S. Agency for International Development (USAID)
