Google, Rihanna Join Fintech-Powered Effort To Donate $100 Million To Consumers Hardest Hit By Coronavirus
Google, Rihanna’s Clara Lionel Foundation and the Schusterman Family Foundation—the charity started by the late oil magnate Charles Schusterman and his wife Lynn—are giving cash to the hardest-hit consumers from the coronavirus. They’re backing a “Project 100” drive that began last month to send $1,000 to 100,000 Americans. Other donors include philanthropic organization Blue Meridian Partners and impact investing firm Flourish, plus The Late Show with Stephen Colbert.
GiveDirectly, a New York nonprofit founded by 39-year-old entrepreneur Michael Faye, is leading the effort. While getting his Ph.D. in economics at Harvard, Faye learned that providing cash—not workforce training or education—is the best way to help the extreme poor. “Cash recognizes that one size doesn’t fit all,” he says. “The extreme poor have excruciatingly difficult choices to make. Do I send my daughter to secondary school or feed my newborn?” Donors know little about recipients’ lives, so cash helps them most, he says.
He started GiveDirectly in 2009 and juggled the project while working as a consultant at McKinsey and eventually cofounding two fintech startups. Since its start, GiveDirectly has raised $280 million and distributed $160 million to the extreme poor. Over the past five weeks for Project 100, it has partnered with a fintech startup and another charity to raise $55 million of a $100 million goal. Twenty million of that came from the Schusterman Family Foundation.
In March, after the coronavirus slowed the U.S. economy to a crawl, GiveDirectly needed a way to quickly identify extremely poor Americans affected financially by the virus. It partnered with Brooklyn fintech startup Propel, whose Fresh EBT app has more than 2 million low-income users. Fresh EBT helps food stamp recipients check their balances without having to call an 800 number. With GiveDirectly’s guidance, Propel is targeting the poorest zip codes that have been hardest hit with coronavirus cases to decide who gets paid.
“We’re glad we’ve been able to operationalize so quickly,” Faye says. “This week we’ll move more than $10 million, which is essentially the money we raised last week.” Recipients can get their money through direct deposit into a bank account, paper check, PayPal, Venmo or pickup at a MoneyGram location.
Portland, Oregon, charity Stand for Children is co-leading Project 100 with GiveDirectly and Propel. It’s donating staff time to answer recipients’ questions, bringing in philanthropists as donors and recruiting influencers like Julia Louis-Dreyfus to spread the word.
The joint effort is already producing a big impact. Anica Henderson, a 28-year-old Brooklyn resident who worked as an elderly care aid before New York City schools shut down, used the $1,000 she received to pay her rent and buy an air purifier for her asthmatic 6-year-old daughter. Another woman had a mere $0.45 in her bank account before the $1,000 payment arrived, Faye says.
Andrew Yang is also helping to spread the word about Project 100. On a broader scale, Yang has turned the idea of giving Americans cash into a national conversation with his support of a Universal Basic Income. Others helping GiveDirectly spread the word are Ariana Grande and Georgia politician and former congresswoman Stacey Abrams.
Separate from Project 100, GiveDirectly is sending millions of dollars to consumers in countries like Kenya, Uganda and Morocco who have been financially affected by the coronavirus. Each dollar goes much further in these countries, so in Kenya, GiveDirectly is giving people in Nairobi slums $28 a month for 3 months. It aims to reach up to 200,000 people. GiveDirectly is trying to raise another $100 million for its Africa relief effort as the coronavirus spreads there.
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