This report, the third in a <a href="https://www.centerforfinancialinclusion.org/series/municipal-cash-transfer-programs-design-ids-and-data-protection">series</a> on municipal cash transfers in the U.S., focuses on data protection for undocumented or mixed-status beneficiary households. In the context of cash-based assistance (CBA) programs, poor data protection practices could add additional risks for low-risk individuals by providing data trails that could pave the way for unauthorized access to applicant or beneficiary data or leakage of personally identifiable information. These could leave a digital footprint that can make it easier for law enforcement to target undocumented individuals.

Considering these risks, we have identified and detailed approaches and strategies used to protect applicant and beneficiary data through four programmatic phases: targeting beneficiaries, outreach and onboarding, disbursement and distribution, and ongoing monitoring and data storage/retention. Insights in this report are gleaned from CFI interviews with cities, community-based organizations (CBOs), debit card providers, and privacy advocates.

This report and the others in this series are intended to guide municipal officials and CBOs considering or developing programs to support undocumented or mixed-status households. The insights may also be of interest to organizations advocating for and supporting the rights of undocumented populations, students and academics, and anyone interested in access to financial and public services for all members of U.S. communities.

Protecting Beneficiary Data: Guidance for Municipal Cash Transfer Programs Responding to COVID-19

Though U.S. citizens and residents received economic support following passage of the CARES Act in spring of 2020, undocumented and mixed-status households were left behind. To bridge this assistance gap, state and local governments across the U.S. have partnered with community-based organizations (CBOs) to establish cash transfer programs to support these populations during the pandemic.

This report, part of a three-part <a href="https://www.centerforfinancialinclusion.org/series/municipal-cash-transfer-programs-design-ids-and-data-protection">series</a>, provides practical guidance to municipalities considering or currently operating direct cash assistance programs. It is based on insights from in-depth, semi-structured interviews conducted by CFI with 12 program administrators representing seven cash assistance programs.

We identify and detail practices for defining target beneficiaries, establishing eligibility criteria, conducting outreach, onboarding recipients, and disbursing funds. This report also highlights the relative advantages and disadvantages of different approaches at each step of the process.

The insights here may also be of interest to organizations advocating for and supporting the rights of undocumented populations, students and academics, and anyone interested in access to financial and public services for all members of U.S. communities.

Designing Municipal Cash Transfer Programs to Mitigate the Economic Impact of COVID-19

Although the CARES (Coronavirus Aid, Relief, and Economic Security) Act has mobilized a whopping <a href="http://crfb.org/blogs/whats-2-trillion-coronavirus-relief-package">$293 billion</a> to provide one-time economic impact payments to American households, many are ineligible for this federal support due to <a href="https://www.nilc.org/resources-covid19-crisis-and-consequences/faq-eligibility-for-assistance-based-on-immigration-status/">their immigration</a> status or living in a <a href="https://www.nytimes.com/2020/04/28/us/coronavirus-undocumented-immigrants-stimulus.html">mixed-status household</a>. Cities, counties and states across the United States are stepping in for these residents by bridging the gap with cash transfer programs of their own.

Beyond the inherent complexity of quickly establishing a safe and efficient cash distribution program, serving this marginalized population presents specific challenges. First, local governments need to identify and enroll beneficiaries from a population that generally lacks official identity documentation and can be difficult to reach. Second, in addition to being undocumented, this population is often unbanked or underbanked, raising questions about how cities and counties can safely deliver financial stimulus in a cost-effective manner. Third, data protection is high stakes for this population, which tends to be at greater risk for financial fraud or exploitation, as well as targeting by Immigration and Customs Enforcement (ICE).

Given these challenges, how should US cities design cash transfer programs to serve undocumented communities?

With support from Open Society Foundations, CFI identified more than 70 examples of city- and county-led municipal identification initiatives (active, inactive, and proposed) that sought to address challenges residents face in obtaining government-issued forms of identification. For marginalized and vulnerable populations—such as the undocumented, those experiencing homelessness, and the elderly—a lack of official identification makes everyday tasks like accessing social services or opening a bank account difficult.

Cities that have established these programs, particularly those that have sought to leverage them to advance financial inclusion, provide several lessons to cities facing similar challenges while establishing cash assistance programs in response to COVID-19.

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Municipal IDs Offer Cities Lessons for COVID-19 Cash Assistance Programs

Following the <a href="/id2020-summit-2019">ID2020 Summit</a> in September, Eric Noggle, Senior Research Director, talks to Good ID about the intersection between good digital ID and broader socio-political change. Read more in <a href="https://www.good-id.org/en/articles/everything-connected-making-good-id-matter/">Everything Is Connected: Making Good ID Matter</a>.

Open Society Foundations

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Protecting Beneficiary Data: Guidance for Municipal Cash Transfer Programs Responding to COVID-19

Designing Municipal Cash Transfer Programs to Mitigate the Economic Impact of COVID-19

Municipal IDs Offer Cities Lessons for COVID-19 Cash Assistance Programs