The SHF prioritizes allocation of funds according to the overall emergency needs in the country as defined by the Humanitarian Response Plan (HRP). Funding decisions are guided by a strategy developed in consultation with the field offices, Inter-Sector Coordination Group (ISCG), the Humanitarian Country Team (HCT) and SHF Advisory Board (AB) and endorsed by the Humanitarian Coordinator (HC).

The SHF has two inclusive and efficient allocation processes for timely allocation and disbursement of donor resources to the most critical humanitarian needs:
 

1. Standard Allocation (SA): Most of the funds are allocated through this process. Ideally, the SHF has two SA calls annually. The two SAs are done during the first and third quarter of each year; though timing is determined by availability of funds. Additional standard allocations may take place throughout the year. From 2020 an emergency rapid response mechanism was inbuilt in the SA under which one low risk partner has a pre-approved $200,000 additional funds that can be used to facilitate time sensitive response or to kickstart emergency response as the partner looks for additional funds.
2. Reserve for Emergencies (RfE): Under this process, SHF partners can apply for a grant not exceeding $500,000 to respond to unforeseen emergencies or to address urgent humanitarian needs. The SHF has specific criteria for the Reserve for Emergencies (RfE). They are described in the SHF Programmatic Manual. The Advisory Board has set a target of $6 million that needs to be available in the SHF as a revolving fund to meet arising emergency needs throughout the year.

The standard and reserve allocations are completed within a specified time frame to allow partners to respond in a timely manner. For all allocations, the HC publishes an allocation strategy, which specifies the sectors and activities eligible for funding. It is developed by OCHA in coordination with the relevant IASC sectors. The SHF Advisory Board reviews and endorses the allocation strategy paper. All allocations fit within the SHF 2020 Position Paper agreed with the Advisory Board each at the beginning of the year.

The allocation strategy paper also lists the key strategic and technical criteria for project proposals, including beneficiary targeting, programmatic approaches, guidance on cross-cutting issues of accountability to affected populations, environmental protection, protection mainstreaming, addressing the needs of people with disability and gender responsiveness in humanitarian response.

The SHF project cycle is managed through an online platform known as the OCHA’s Grant Management System (GMS). Information on all 18 OCHA managed country-based pooled funds (CBPFs) is housed here. The fund managers and implementing partners work online to manage all aspects of project management such as project proposals submission, revision and both programmatic and financial reports. OCHA also uses the system to coordinate project review, monitoring and partner performance