Stablecoins Shine in Humanitarian Aid as CGAP Report Cites Success Stories

A recent report by CGAP (Consultative Group to Assist the Poor) highlights the potential of stablecoins in humanitarian cash transfers. The study examines whether stablecoins can help organizations move funds across borders when correspondent banking is slow, expensive or unavailable.

CGAP identifies high fees, opaque foreign-exchange margins, multi-day settlement delays and banks exiting high-risk jurisdictions as recurring obstacles for aid delivery. The report notes that stablecoins operate on blockchain networks, with the choice of network affecting cost, speed and availability.

The report cites several practical examples of humanitarian implementations using Stellar and Algorand-based tools. In one Sudan example, the Norwegian Refugee Council used KoalaPay to transfer USDC (a stablecoin) to local disbursement partners. Local partners converted USDC into Sudanese pounds before delivering funds to recipients.

The report also references a Ukraine program launched in December 2022 using Stellar's Aid Assist platform and MoneyGram. This program had distributed $4.6 million to 2,500 households by its second year.