What can 20 billion financial transactions tell us about the impacts of Covid-19 fiscal transfers?

BIS Working Papers  |  No 1130  | 
19 October 2023



Fiscal transfers can play a key role to support an economy facing a downturn. During the Covid-19 pandemic in 2020 and 2021, governments promptly implemented direct cash transfers to individuals. We analyse the impacts of these transfers on household consumption and investigate the different responses across individuals of varying income levels.


Leveraging a rich transaction-level cash transfer data set, we quantify the impacts of Thailand's 2021 direct fiscal transfer using statistical matching and panel regressions. The aim of this event study aim is to answer two policy-relevant questions: (i) how much more spending did the recipients make as a proportion of the stimulus? And (ii) did the stimulus make up for lost spending during the lock-down?


Overall, the recipients spent on average 40% of the money received over the first six days and 49% accumulatively over the first three months, as compared with a matched control group with similar characteristics. There is significant variation and the lower-income individuals spent more as a proportion of the stimulus. In addition, the fiscal injection more than compensated for lower-income individuals' lost spending during the lock-down. 


We investigate the impacts of fiscal transfers on households during the Covid-19 recovery period using a novel transaction-level money transfer dataset. The study focuses on direct fiscal transfers in 2021 that occurred as a result of the second major wave of Covid-19 in Thailand and analyses spending patterns for the recipients. We group the recipients by income levels and analyse patterns at the monthly and daily levels. The two main research questions are: (1) How much more spending did the groups make as a proportion of the fiscal stimulus? and (2) Did the stimulus makeup for lost spending during lock-down? We find that overall the recipients spent, on average, 40% of the money received over the first six days and 49% accumulatively over the first three months compared to a matched control group with similar characteristics. Unsurprisingly, the lower income group spent the highest proportion of the money received and the fiscal injection more than covered up for their lost spending during the lock-down period.

JEL classification: D12, H31, C55

Keywords : impacts of fiscal transfers, Covid-19, transaction-level data