Cash grants and in-kind grants differ mainly in how assistance is delivered and how recipients can use it. While cash grants offer flexibility and support local markets, in-kind grants limit choice but allow government to direct spending toward a particular purpose. Cash grants can also be spent on imports, increasing demand for foreign currency and stressing exchange rates. However, it does not follow that cash grants are inherently destabilising, or that in-kind grants are inherently safe. Ultimately, stability does not depend on whether assistance is given in cash or kind.