UNHCR Zambia had been providing cash assistance to refugees in the Meheba Refugee settlement camp through the Ministry of Community Development and Social Services (MCDSS) and Ministry of Home Affairs (MHA). This project designed and implemented the digitization of UNHCR’s cash-based interventions (CBI) in the camp.
UNHCR provides initial assistance to newly arrived refugees and continuous support to vulnerable refugees. However, UNHCR face challenges in delivering and refugees in receiving cash. The project investigated and addressed the challenges that stakeholders faced in cash disbursement through digitizing cash payments.
MSC collaborated to design and test the digitization of cash payments. These are now being scaled up with a view to digitizing the majority of payments to refugees in Zambia. Lessons from the project, in particular, the streamlined processes MSC developed for digital payments, are to be replicated in other sites where UNHCR has been digitizing payments.
The Indian government subsidizes LPG (cooking gas) for eligible low-income beneficiaries. MSC designed processes to route the subsidy to the bank account of beneficiaries. After the Indian government implemented the process and removed duplicate entries in the beneficiaries’ database, about 35.6 million duplicate accounts out of the total 182 million were eliminated from the system.
Upon a successful roll-out of routing the LPG subsidy, MSC helped the government to improve the execution and communication of the program. We also helped to prepare and structure the “Give It Up” campaign, under which economically better off people were urged to give up their subsidy. As a result, over 10 million people in the country gave up their subsidies. The government estimates a savings of about USD 3.23 billion through the implementation of these reforms. The success of this program convinced the government to move to digitize social benefits transfers across a range of initiatives.
The government redistributed the savings from this program by providing free cooking gas and cook stoves to low-income households under the Pradhan Mantri Ujjwala Yojana (PMUY) initiative. After PMUY launched, MSC helped the government to assess the implementation. We conducted three rounds of assessment for the program, which resulted in important changes to delivery approaches and safety messages, with an impact on nearly 50 million rural and urban households.
The impact of Ujjwala has been transformational. MSC’s studies show that this program had an impact on health, gender empowerment, and the social structure in rural areas. MSC also provided recommendations to the government to improve the affordability and accessibility of LPG refills in rural areas further.
ACRE Africa provides innovative agricultural insurance products in partnership with leading insurance companies in East Africa. MSC worked with ACRE Africa to design a cost-effective, village-based, insurance product promotion model.
The intervention involved teams of trained farmers and peer-to-peer learning at the community level to promote the adoption of mobile phone-enabled crop insurance products among smallholder farmers in Kenya.
The outreach model increased adoption of the weather index seed insurance by 10% during the pilot phase. The partner has since adopted the model to reach smallholder farmers in remote rural areas of Kenya, Rwanda, and Tanzania. By 2017, ACRE Africa was recognized as a leading provider of agricultural insurance in the region and has enabled more than 1 million farmers in Kenya, Rwanda, and Tanzania to access agricultural insurance. ACRE Africa worked with leading insurance companies to underwrite more than USD 75 million to mitigate against weather-related risks.
Alliance for a Green Revolution in Africa (AGRA) hired MSC to provide technical assistance to its partner, SELF MF Tanzania. The institution provides wholesale loans to mass-market banks and MFIs in Tanzania. The MSC team worked with four MFIs and SACCOs to develop seasonal agriculture loan products to enable approximately 25,000 smallholder farm inputs including seeds, farm labor, and fertilizer.
The tranched loan product also provided some funds for household expenses, just before harvest time when many farmers have low-income streams. The loans are disbursed through mobile money services and therefore reach many more farmers than would have been the case through the few branches of the partner MFIs and SACCOs.
The number of farmers accessing these loans gradually increased in the first farming season in Southern Tanzania to reach 1,000 farmers. By mid-2018, three partners had disbursed loans worth USD 500,000 to smallholder farmers in Tanzania and improved farming activities in the country significantly.
MSC led an intervention on access to finance with the Central Bank of Papua New Guinea to build a microfinance sector in the country. As part of the four-year-long intervention, we facilitated setting up a risk share facility (RSF).
The RSF helps manage some of the risks associated with MSE lending to encourage partner financial institutions to expand their loan portfolios. It improves the quantum of lending to MSMEs and channels a greater number of the deposits collected into loans to businesses rather than into inter-bank deposits and government securities. We also set out procedures and provided support for rolling out the RSF facility for partner financial institutions.
Through the project, MSC’s intervention reduced the turnaround time of individual loans to MSMEs from two months to eight days, while the average loan disbursed increased by 95% to USD 5,500. As at the end of 2017, the bank had reduced its PAR 30 from 29% in 2012 to under 5%. By June of 2018, the Central Bank had given 1,765 loans to MSMEs, including 1,086 women clients, under the risk share facility.
Urwego Opportunity Bank (UOB) is a commercial microfinance bank in Rwanda. UOB contracted MSC to determine the financing needs of the MSME sector in Rwanda. MSC was engaged to conduct primary research, improve UOB’s products, and thereby increase product uptake and profitability.
MSC helped UOB conduct a detailed market segmentation, develop products for MSME finance, formulate financial projections, define loan processes and procedures, formulate a credit-scoring model, and support the pilot test and implementation of the products developed. MSC’s intervention reduced the turnaround time of individual loans to MSMEs from two months to eight days. The average loan disbursed increased to USD 5,500.
At the end of the pilot, UOB financed 550 enterprises, with a portfolio of USD 1.66 million. OUB maintained high portfolio quality, with less than 3% non-performing loans. After the pilot test, the MSC team supported the rollout of the product across all branches in a phased manner. As of September, 2017, SME loans for UOB was about 38% of the overall portfolio, with 300 SME loan clients and a portfolio of USD 8 million. The PAR 30 days reduced from 29% in 2012 to 8%.