Abstract

This systematic review investigates the transformative potential of blockchain technology in enhancing Public Financial Management (PFM) and improving accountability in international aid distribution. By examining peer-reviewed articles, policy papers, and technical reports published between 2015 and 2023, the review synthesizes existing knowledge on how distributed ledger systems can address long-standing challenges in financial transparency, corruption, and inefficiency in global aid mechanisms. The study explores various blockchain use cases including smart contracts for automating fund disbursement, tokenization for traceable transactions, and decentralized auditing for real-time oversight. Findings reveal that blockchain’s immutability, transparency, and decentralized nature contribute significantly to minimizing aid leakage, improving donor-recipient trust, and reinforcing compliance with international reporting standards. Case studies from countries implementing blockchain-enabled solutions—such as UNDP’s pilot programs and World Food Programme’s Building Blocks—demonstrate promising outcomes, including cost reduction, improved beneficiary verification, and streamlined operations. However, the review also identifies notable barriers to large-scale adoption, such as technical complexity, regulatory uncertainty, limited digital infrastructure in low-income regions, and stakeholder resistance due to unfamiliarity with the technology. This paper applies the PRISMA framework to ensure rigorous data extraction and critical appraisal of the included literature. The synthesis highlights three core themes: (1) transparency enhancement through real-time tracking, (2) fraud prevention via immutable records, and (3) administrative efficiency gained through automation. The review emphasizes the need for multi-stakeholder collaboration, capacity building, and regulatory harmonization to enable effective blockchain integration into PFM systems and aid supply chains. Conclusively, blockchain holds transformative potential for global accountability frameworks, particularly in fragile economies where trust in financial governance is often low. The study calls for further empirical research, sandbox testing, and adaptive policy frameworks to assess long-term viability and impact. By leveraging distributed ledger technologies, international aid agencies and governments can foster a more transparent, efficient, and equitable financial ecosystem.