Proposition to improve mobile money services for cash ... to improve mobile money services for cash...
-
Upload
phungthien -
Category
Documents
-
view
217 -
download
2
Transcript of Proposition to improve mobile money services for cash ... to improve mobile money services for cash...
Proposition to improve mobile money services for cash transfer interventions (and financial inclusion)
Cash Working Group - Goma – October 28th 2016
CONTENTS
• Who are we?• Mobile money experience on cash transfer and financial inclusion in the World and
DRC• Proposed solutions to make mobile money a viable solution for cash transfer and
financial inclusion• Next steps• Questions
£50mProgramme
5Bureaux
44core staff
ELAN DRC is a private sector development program that aims to increasethe income of over a million low-income men and women in the DRC by2020.
It provides international expertise and market insight to businesses, financialinstitutions and industry associations, supporting them to innovate and grow.
It is implemented by the consultancy firm Adam Smith International andsupported by the UK government as part of its private sector developmentstrategy in the DRC.
ELAN RDCBranchless banking strategy (mobile money and agency
network)
1. Increased confidence in alternative distribution channels
2. MNOs and financial institutions offer appropriateproducts/services to poor consumers
3. MNOs and financial institutions improve agents quality servicesand expand agents network to serve poor consumers
Main Branchless banking achievements
1. Study on consumer financial needs & behaviour assessment
2. Orange Money agent distribution network training anddevelopment
3. Joined TV and radio educational campaign with Airtel Money ,Tigo cash, M-Pesa and BCC
4. Tigo Cash Women Micro-entrepreneurs Agent network
5. Study on opportunities on mobile money for financialinstitutions
Mobile Money, a pertinent tool for cash transfer intervention and financial inclusion
Observation Proposition Justification for mobile money
Movement in the aid industry to advocatefor a shift away from in-kind aid towardscash transfer programmes as ahumanitarian tool.
Cash transfers rose up to 6% of totalhumanitarian spending in 2015 from 1% in2004.
Cash transfers do not distort local marketsfor goods and services and as such shouldbe closely looked at by MSD programmes.
Increasing recognition of the vital role ofcomplementary interventions (humanitarianaid and market system developmentprograms).
Increase linkages and collaborationbetween humanitarian aid and marketsystems development programs tocreate a favourable environment for mobilemoney to:
1. Enable efficient cash transferinterventions to displaced people in acrisis context;
2. Encourage financial inclusion in a preand post crisis context.
Humanitarian AidExample of successful use of cash transferin Kenya and Somalia.
Financial inclusion271 mobile money services in the worldand 441 millions mobile money accounts in93 countries, 30% being actives (but only11% have more than 1M active users).
Financial inclusion after crisis contextin Malawi, Opportunity International Bankreports that 45% of recipients enrolled inthe Dowa Emergency Cash Transferscheme are still using their bank accountmore than 2 years after the end of theprogramme.
But: mitigated experience with Mobile Money in DRC
Cash transfer experience in DRC
Strengths
• More secured for beneficiaries and NGO
• Enable beneficiaries to save money (Sifa,emergencies)
Weaknesses
• Nascent market: underdeveloped mobilemoney environment / inexperienced serviceproviders and weak infrastructure
Greater staff time to manage andadditional / unexpected costs
• Liquidity management
• Weak beneficiaries financial literacy andunderstanding / access to technology
• Interest for the “NGO market”
Limited uptake of Mobile Money in DRC
Ecosystem set Standard mode
TransferAgents
Salary paymentMerchants
Cash deposit
Float replenishing
MM
conversion
Customer
Mobile money provisioningMobile money provisioning
Mobile money service
Ecosystem Set up• Customer education• Distribution network set up
• Select and recruit the agents
• Select and recruit the merchants
• Training modules• Distribution management tools• Select and recruit the IMF
ELAN RDC intervention:• Technical assistance• Training and education
programme development• Co-funding consultant payment
Recommend to bring in a FI as cash partner:• More payment to Merchants and less withdrawal • More Merchants mobile money conversion and less Agent cash replenishment
Payment
Cash out Cash in
Legal, regulatory and compliance framework and
process
Ecosystem setIntervention mode
Agents
Merchants
MM
conversion
Contract sign offFund provisioningNGO
NGO MPESA Account
m-pesa account credited
Bulk payment
Payment
Cash out
Float replenishment
Beneficiary registration and KYC framework
Information/ education, ME, SIM safe keeping and CRM framework
Distribution network set up:• IMF recruitment• Agents/merchant qualification FW• Recruiting Agents/merchants• Training program• Distribution tracking tools
Summary of advantages of the proposed model
Actors Advantages
Local economy
1. Development of the local economy thanks to the creation of a mobile money ecosystem2. Less pressure on cash availability3. Improved security4. Financial inclusion
Beneficiaries
1. Improved security2. Easy access to goods without pressure on cash3. Time saving4. Financial inclusion
NGO
1. Improved security2. Improved transparency3. Time saving4. Reporting5. Reinforced relationship with MNO
MNO1. Reinforced infrastructure2. Reinforced relationship with NGO
Risks and mitigation actions
Risks Mitigation actions Who does? Who pays (tbc)?
Slow start up Preparation plan ELAN / MPESA / NGO
“Entrée en relation” / contract signatureDevelopment of transparent procedures andprocesses to be communicated to NGOs
ELAN / MPESA with thesupport of NGOs
ELAN / MPESA
Mpesa accounts opening forbeneficiaries (KYC)
NGO bears the risk and open accounts on behalf ofbeneficiaries
ELAN / MPESA / NGO NGO
Quality of the distribution network(agents/merchants)
Improvement of distribution management proceduresand training of agents / merchants
ELAN / MPESA ELAN / MPESA
Merchants’ lack of understanding oftechnology and interest in MM
Development of training tools + trainingIncentive systemBusiness case for merchants
ELAN / MPESA / NGOELAN / MPESA / NGO
Unavailability of mobile phones andburden on vendors
MPesa lends phones to merchants MPESA MPESA
Beneficiaries’ lack of understanding oftechnology and customer protection
Development of training and CRM tools (leaflets,posters etc…)Training of beneficiaries
ELAN / MPESA / NGO ELAN / MPESA / NGO
MFI’s lack of understanding of theprocess
Development of transparent proceduresBusiness case for MFI
ELAN / MPESA ELAN / MPESA
Identification of the pilot area(s) NGO proposes most likely affected areas NGO
Work plan way forward
M1 M2 M3 M3 M4 M5 M6 M6 M7 M8
Introductory and due diligence Frame work + contract
Compliance framework
NGOM-pesa account
Beneficiaries account opening framework:• Registration process• KYC policy
Education/information programme:• Mobile money• User guide
Gap analysis• Recommendations• Implementation Action plan• Training modules development
Implementation:• Training programme• Tracking tools deployment• Field staff deployed• Pilot
Crisisassessment
Cashtransfer Observation Evaluation