Joseph Lessard, 16. Voices rfom the USAID/Macedonia Field ... · Hugh Haworth, USAID/E3/MPEP...
Transcript of Joseph Lessard, 16. Voices rfom the USAID/Macedonia Field ... · Hugh Haworth, USAID/E3/MPEP...
1.6 Voices from the Field: Case Studies in
Engagement
Hugh Haworth, USAID/E3/MPEP (Moderator)
Heath Cosgrove, USAID/Lebanon
Joseph Lessard, USAID/Macedonia
Elizabeth Feary, USAID/Yemen
Steven Rynecki, USAID/Afghanistan
Mobile Money in Afghanistan
2013
Leveraging the Mobile Network to Transform Afghanistan’s Financial Sector
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Leveraging the Mobile Network
Using the Mobile Network to Bridge the Infrastructure, Security and literacy Gaps • 70% (18 million) Afghans use mobile phones • 85% of Afghans live in areas covered by the four mobile operators • Interactive Voice Messaging technology bridges the literacy gap
Areas shaded in red reflect populations covered by existing mobile networks. The circles represent key urban centers.
• Mobile money has the power to revolutionize the banking sector in Afghanistan, enabling micro-lending, commercial transactions, salary payments, and money transfers, reducing transaction costs and corruption, and catalyzing new products and services
VALUE PROPOSITION
RESEARCH • Do you homework. It helps to have experts assess your
programs and see if mobile money is feasible COST-BENEFIT • If you see a fit, it’s time to perform a simple cost-benefit analysis
to ensure what you invest has a higher return for your program beneficiaries
DECISION • If you believe mobile money has merit, start the activity planning
process with the Mobile Money Adviser
Should I apply mobile money to my program?
Members of Afghanistan’s Mobile Money Operators Assn
Members of Afghanistan’s Mobile Money Operators Assn
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Consumer Issues
• Low consumer literacy • Low consumer trust • Lack of awareness
Provider Issues
• Products not often designed for low-income people
• Limited agent networks
Market Issues
• Interoperability • Liquidity
Mobile Innovations Key Challenges
Teacher Salaries
Utility Collections
What we did so far: Provided technical assistance to regulators Grants for pilots targeting large payment streams (e.g. GIRoA salaries, utility payments)
Mobile Innovations Current Pilots
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How does mobile money work?
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Bank
Clie
nt
Agent bank account linked to Mobile Money Service Provider for cash and commission transfer
Cash out from agent to client
Electronic value sent to client’s mobile wallet (salary, family) Ag
ent
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- Agent account debited
Client account credited + 4
Client opens mobile money account via agent
Mobile Money Service Provider Bank Accounts (Pooled funds from all clients in at least four banks to diversify risk)
Key Findings of the Sector Financial Model
Public awareness and adequate resources devoted to training is critical to acceptance and uptake
Competition will increase awareness and acceptance and put downward pressure on prices
Expanded salary and other forms of government payments is the fastest way to inject funds into the ecosystem and will have the greatest impact on future use case adoption
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An extensive agent network is the key to the ecosystem, the largest cost for the MNO, and the most important element for the end user. Key factors include:
• Convenient locations • Liquidity management
(enough money in the till) • Consumer protection • Anti-Money Laundering,
Anti-Terrorist Financing and Know Your Customer
• Mobile money is ultimately a volume driven business
• Speed of expansion is critical to generate sustained momentum
• Wide coverage (anytime, anyplace availability) is also critical
• Interoperability is key to scale
Lessons Learned
Proposed Way Forward
Three concurrent tracks: 1. Build on CSTC-A’s ANP salary payment expansion
by adding as many Afghan Government and USG-funded payments within the 24 unbanked districts as possible such as teachers and district officials.
2. Maximize mobile payments usage in the first tranche of Transition municipalities and provinces in collaboration with MNOs and banks. Prospective payment flows include:
a. Utility payments (750,000 electricity users) b. Internal remittances (i.e. from Kabul to Balkh) c. Microfinance and agricultural loan repayments d. Government and commercial salary payments
3. Sector-wide investments to ensure stable, secure and sustainable roll-out
a. Strengthen the supervisory capacity of Da Afghanistan Bank
b. Supply ID cards required for customer registration -- only 30% of Afghans have IDs.
c. As needed, invest in agent network, telecom infrastructure and interoperability.
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