Expanded access to social protection is critical to address the many faces of poverty, inequality and exclusion – and building a more resilient and inclusive growth model. In Colombia, the integrated social protection system Más Familias en Acción,covering health, social security and education, has helped 3.4 million persons overcome income poverty and 1.9 million persons escape extreme poverty between 2010 and 2018. Though the system represents one of the fastest reductions in multidimensional poverty in the world, millions were without coverage when the COVID-19 pandemic hit and faced increased risks of falling into the poverty trap.
To quickly expand coverage, Colombia leveraged the investments in Más Familias en Acciónto create a new programme (Ingreso Solidario), successfully reaching 2.6 million additional households in three months.
The programme benefitted from two major improvements: first, targeted identification of vulnerable people through an integrated database that connects information from already existing sources, such as the national Identification System of Potential Beneficiaries (‘Sisbén’), with data from social programmes to identify persons without coverage or other cash transfer benefits.
Second, improved financial inclusion through digital solutions. By harnessing recent regulatory modernizations that enable digital financial services to pay beneficiaries through mobile phone systems and electronic wallets, 1 million households were banked between April and June 2020, reaching as many people in two months as the number of people covered in social protection over decades. These monetary transfers are projected to help mitigate the expected increase in poverty by almost 5 percentage points and mark an important achievement in leveraging financial sector regulation and infrastructure to target people in risk of being left behind.