Abstract: Income interventions with pro-poor targeting is a common fiscal policy around the world although the corresponding distributional effects on consumption and savings are not well understood. Using rich longitudinal data on income and consumption of Indian households, we estimate distributional effects of such interventions in a model with endogenous consumption and savings distribution, where households face uninsured income risks. The standard scheme of interventions that consistently targets low-income cohorts, has muted distributional impacts on targeted and non-targeted cohorts alike. In contrast, a fiscally equivalent scheme that changes the expected income profile of the targeted households in the same initial cohort irrespective of their future incomes, generates substantially larger effects by changing income mobility for both the targeted and non-targeted cohorts. This mobility-based channel generates consumption responses even though the magnitude of the shock is lesser for the initially targeted cohort, as it more than offsets the effect from permanent income shock. Quantitatively, such an intervention in the order of 0.6 percent of output, approximating the Indian scenario, increases consumption share of the targeted cohort by nearly 2.5 percent, five times as large as the effect of standard interventions. The distributional effects are similar to those arising from universal basic income.