ISLAMABAD, March 10: The World Bank has agreed to an urgent request from Pakistani government for a soft loan of $125 million to facilitate implementation of the Citizen's Damage Compensation Programme (CDCP), a cash grant programme for the flood-hit families, according to sources.
However, the sources said on Thursday that despite the grant of $125 million by the International Development Association of World Bank, $190 million by the USAID, $100 million by the DFID and $70 million by an Italian lending agency there remained a project financing gap of $350 million.
The country's main social safety net initiative, the Benazir Income Support Programme (BISP), was still in the process of developing its systems and was hardly in a position to manage a nationwide cash grant initiative like the CDCP, said the sources.
At the start of the first phase of the CDCP, only 3 per cent of the registered families reported having received grants from the BISP and 2 per cent from other sources.
Keeping this in mind, the government in consultation with the provincial governments and Nadra decided to strengthen the programme. In its first phase the authorities injected Rs34 million into the programme, shared equally by the federal and provincial governments. As a result, an initial cash grant of Rs20,000 was given to each eligible family.
By September, 1.4 million families had been paid this amount. The government expects to pay the amount to a total of 1.8 million households under the programme's first phase.
The authorities now seek to pay Rs40,000 to each affected family. The selection of the beneficiaries would depend on the damage inflicted on their houses, the sources said.
Beneficiaries are expected to use the money to not only cover basic consumption but also to recapitalise assets, recover their livelihoods and repair houses.
Payments will be delivered to all eligible beneficiaries using the same system --- the ATM/debit cards issued to them during the first phase.
Partner banks will instal ATM machines at payment centres, create virtual accounts for payment and activate debit cards enabling beneficiaries to withdraw their funds, according to the sources.