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New Trends in USAID Procurements. The transition towards e-Payments April 9, 2013. What we will cover today. Agenda. Introductions USAID’s Commitment to e-Payments USAID Tanzania: Mission Perspective on e-Payments Assessing viability of e-Payments Practical Tips for Implementation
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New Trends in USAID Procurements The transition towards e-Payments April 9, 2013
What we will cover today Agenda Introductions USAID’s Commitment to e-Payments USAID Tanzania: Mission Perspective on e-Payments Assessing viability of e-Payments Practical Tips for Implementation Q & A/Upcoming Events 3 4 11 19 22 28
Introductions NandiniHarihareswara Operations Director & Sr Partnerships Officer NyaKwaiBoayue Acquisition and Assistance Specialist USAID/Tanzania Hamilton McNutt Program Manager, Payment Innovations Anthony Latta Treasurer, Finance and Administration Svitlana Hall Operations Associate, Finance and Administration
Why USAID Supports e-Payments 1 2 3 4 5
The Philippines ALL SOLICITATIONS FROM THE MISSION ENCOURAGE THE CONSIDERATION OF ALTERNATIVE PAYMENT METHODS • Request for Proposal No. SOL‐492‐12‐000033, Facilitating Public Investment (12/8/12): • L.5 ADDITIONAL INSTRUCTIONS TO OFFERORS (6) Electronic Payments USAID encourages the Contractor to consider alternative methods of payment, especially electronic forms of payment, in place of cash payments when appropriate.
Afghanistan THE AFGHAN MISSION IS PROMOTING THE USE OF E-PAYMENTS IN PROCUREMENTS • Request for Proposal No. SOL-306-13-00002, Regional Agricultural Development Program – South (#2) (1/22/13): • This RFP includes • the use of electronic payments in the Statement of Objectives • the ability to address and implement key areas of the Statement of Objectives in the Technical Evaluation Criteria. USAID, through the Financial Access for Investing in the Development of Afghanistan (FAIDA) program and other programs, has encouraged the use of electronic payments, including mobile money . . . The contractor should utilize these services to the greatest extent feasible within its company policy to strengthen the efficiency and security of financial transactions at all stages of value chain activities.
Haiti THE MISSION IN HAITI REMAINS A LEADING ADVOCATE OF MOBILE MONEY • Request for Proposal No. SOL-521-12-000021, Haiti Feed the Future Partnership: Northern Corridor (2/14/12): • C.6.3.3 SUB RESULT 3.3: INCREASED ACCESS TO FINANCIAL PRODUCTS …The Contractor shall also explore the possibility of utilizing mobile money technology for conducting financial transactions (payments for purchases, cash transfers, payroll, credit disbursements, credit repayments, etc.). • USAID/Haiti included language requiring support of mobile money in a solicitation in 2011: • The implementer shall support the Haiti Mobile Money Initiative, where feasible, including the payment of staff, the purchase and sale of goods and services associated with program implementation. The Mission will determine the range of allowable cost mobile money services utilized by the contractor/grantee.
Tanzania’s Mobile Industry by the numbers 2012 46.6 million people 76% GSM coverage 23.4 million connections 50% mobile penetration Source: World Bank/GSMA 2011
Mobile Phones vs. Bank Penetration in Tanzania Source: World Bank Databank
Tanzania: Bank Branches vs. Mobile Money Agents 17,000 Interviews* 1608* Work Bank 594* Work Bank *Projected bank branch growth * Estimation combines agents who serve more than one MNO Source: World Bank 2010/TDY Interviews 2012
Areas Of Interest Agriculture and Health Programs Work with program technical teams to examine key payment streams within health or agricultural value chains that experience pain points with cash management Capacity building activities Encouraging programs conducting intensive capacity building activities to assess and implement alternative payment methods for per diem and travel cost reimbursement disbursed to training attendees Operations and Finance Working with implementing partners to encourage use of e-payments in the payment of per diems, travel advances, and other payments made to program staff that normally occur in cash
Current Program Integration The following programs have already begun exploring ways to integrate mobile money into their programs and operations…
Process for making an informed decision and the tools to help you get there
Establish Internal and External Needs Internal External • Accounting systems • Record keeping (audit trail) • Operation procedures • Mobile Network Operator vs. Bank • Selecting a provider • Access to payment system
MNOs vs. Banks Example from the field: Philippines
Internal – Accounting system • Ensure accounting system is ready • Start small and with your staff
Internal – Operating procedure Mobile Money vs. Checks Mobile request Check request Approval Approval Upload Payment Release Prepare check Release check payment Payment approval Payment confirmation Sign check Copy check
Upcoming Events CRS Webinar on their experiences with electronic voucher systems in Haiti (11am-noon); Info: fredrik.winsnes@nethope.org Replay of the Trends in USAID Procurements for audiences in East Africa and South East Asia (8 am EST); info: hamilton.mcnutt@nethope.org NetHope/USAID Webinar on lessons from Tanzania and Uganda in electronic payments (8am EST); info: JChen@qedgroupllc.com Ask the expert Twitter Session with USAID Mobile Solutions Division (11am-noon EST); Info: nandini@usaid.gov