Financing Facility for RemittancesInternational Fund for Agricultural Development (IFAD)

MOBILIZING REMITTANCES FOR DEVELOPMENT

EUROMED MAR. 24 2010

Robert W. Meins

Remittances SpecialistFinancing Facility for RemittancesInternational Fund for Agricultural Development

Financing Facility for RemittancesInternational Fund for Agricultural Development (IFAD)

Topics

Financing Facility for Remittances

2009/2010 focus on Africa

2010 call for proposals

Financing Facility for RemittancesInternational Fund for Agricultural Development (IFAD)

The challenge:Remittances to rural areas

Financing Facility for RemittancesInternational Fund for Agricultural Development (IFAD)

A transfer of $200 is sent from the UK to Kuyunga, Uganda, 50 kilometers from the capital Kampala.

The sender has two options:

1) Send directly to Kuyunga using Western Union.

2) Send to a competing firm in Kampala.

Kayunga

Kampala

Financing Facility for RemittancesInternational Fund for Agricultural Development (IFAD)

Kayunga

Remitter sends $ 200,-

- Transfer fees $40.00

- Exchange rate margin 1.28 %

- Fees on the receiving side

$0

Actual amount received in Kayunga

$ 157.44 (21.28%)

Picking up remittances in rural areas:

Remitter sends $ 200,-

- Transfer fees $19.03

- Exchange rate margin 1.15 %

- Fees on the receiving side

$0

Actual amount received in Kampala

$ 176.68 (11.66%)

Kampala

Financing Facility for RemittancesInternational Fund for Agricultural Development (IFAD)

The Financing Facility for Remittances

Financing Facility for RemittancesInternational Fund for Agricultural Development (IFAD)

Financing Facility for Remittances $18 million dollar multi-donor fund

Consultative Group for Assistance to the Poor European Commission Government Luxembourg Government Spain Inter-American Development Bank UN Capital Development Fund, and Housed at the International Fund for Agricultural

Development

FFR manages 40 projects in 38 countries around the globe

Open to private, public and civil society organizations

Financing Facility for RemittancesInternational Fund for Agricultural Development (IFAD)

What we do… Annual Calls for Proposals Global Forum on Remittances “Sending Money Home” series of studies Together with gov. of France, financed a remittances

initiative managed by the AfDB RemittancesGateway.org portal Dissemination & consultation

G8 Working group on remittances European Parliament Global Forum on Migration & Development Conferences

Financing Facility for RemittancesInternational Fund for Agricultural Development (IFAD)

We explore innovative proposals…

from around the world…

driven by public/private and civil society

groups…

covering a broad range of interventions…

but squarely related to the financial side of

migration…

for this reason we have a strong market and

private sector focus…

Financing Facility for RemittancesInternational Fund for Agricultural Development (IFAD)

Why we do it…

Lower the cost of remittances through competition

Improve capillarity, service rural areas Broaden the scope of financial services Bank the unbanked

… to empower migrant workers and their families to advance on the road to financial independence.

Financing Facility for RemittancesInternational Fund for Agricultural Development (IFAD)

ProjectsFONKOZE

Microfinance (Haiti) Solutions to rural challenges helped after

earthquake Universal Postal Union

Postal networks (Senegal) HIRDA (Netherlands-Somalia)

Migrant organization Philippine Women’s Council (Italy –

Philippines) Migrant women’s group focusing on investment

Financing Facility for RemittancesInternational Fund for Agricultural Development (IFAD)

Global Forum on Remittances &Sending Money Home to Africa

Financing Facility for RemittancesInternational Fund for Agricultural Development (IFAD)

Payout locations per type of RSP (%)

Financing Facility for RemittancesInternational Fund for Agricultural Development (IFAD)

MTO payout locations per company (%)

Financing Facility for RemittancesInternational Fund for Agricultural Development (IFAD)

Concentration of post offices in rural areas(as a % of locations)

Congo Botswana Cote d'Ivoire

Senegal Tunisia Kenya Gabon Djibouti Comoros Algeria0

20

40

60

80

100

Financing Facility for RemittancesInternational Fund for Agricultural Development (IFAD)

Global Forum on Remittances

2007: Latin America (w/ IDB) “Sending Money Home” First global estimate of remittances

2009: Africa (w/ AfDB) “Sending Money Home to Africa” Regulatory & market blockages and opportunities

Financing Facility for RemittancesInternational Fund for Agricultural Development (IFAD)

GFR 2009: Tunis recommendations Increase competition

Empower market actors

Achieve effective and efficient

regulation

Adopt new technologies

Expand access to financial services

Make more financial services available in

rural areas

Financing Facility for RemittancesInternational Fund for Agricultural Development (IFAD)

2010 Call for proposals

Grant financing for projects related to maximizing the development impact of remittances

up to $250,000 for projects

up to $500,000 for mobile financial services

Financing Facility for RemittancesInternational Fund for Agricultural Development (IFAD)

Topic areas

Mobile financial services 

Housing

Postal networks (Micro-) Insurance

Microfinance networks Migrant pensions and other government-to-person payments

Financial services innovations

Securitization

Migrant entrepreneurship and investment (funds)

Open window (innovative projects in other areas)

Financing Facility for RemittancesInternational Fund for Agricultural Development (IFAD)

Basic information

Who can apply? Private sector Public sector Civil society

Cross-sector partnerships encouraged Execution period: 2 years Deadline (short) concept proposals: June

7th 2010

Financing Facility for RemittancesInternational Fund for Agricultural Development (IFAD)

Must have Legal status in country where you operate Audited financial statements

Act on behalf of themselves (not as an intermediary)

Provide counterpart 10-30% non-profit 50% for for-profit (minimum half of which in

cash) Project must be in IFAD member count

Financing Facility for RemittancesInternational Fund for Agricultural Development (IFAD)

RemittancesGateway.org

Institutionally neutral platform Bringing together a broad range of

information Documents News Discussion Agenda Profiles

All are welcome to contribute

Financing Facility for RemittancesInternational Fund for Agricultural Development (IFAD)

QUESTIONS & ANSWERS

Financing Facility for RemittancesInternational Fund for Agricultural Development (IFAD)

Contact information…

Robert W. MeinsR.Meins@ifad.org+39 06 5459 2059

www.ifad.org/remittanceswww.remittancesgateway.org

Financing Facility for RemittancesInternational Fund for Agricultural Development (IFAD)

Countries focusing on diaspora Mexico Philippines Morocco Pakistan