How can India fulfil her inclusive development dream?

Posted on by Deepesh Singh

The Hon’ble Prime Minister has repeatedly emphasized the need to ensure that the benefits of development programs reach all sections of society, particularly the most vulnerable individuals.

Efforts to drive development at the grassroots level have been made through initiatives such as the Aspirational Districts Program and the recently launched Aspirational Blocks Program. The latter aims to enhance government services in 500 Blocks across the country in health, nutrition, education, water and sanitation, agriculture, financial inclusion, and basic infrastructure. The block and gram panchayat are foundational elements of the overall structure of the federal administrative structure. At the local and panchayat levels, administrative officers hold responsibility for executing government schemes and programs. However, implementing several projects, each with its own distinct challenges, places a heavy burden on officers operating at different levels—each with different capabilities.

This note is based on our experience of working at various levels, ranging from the district to the gram panchayat level. It emphasizes three critical factors for implementers to effectively oversee development initiatives in line with the government’s goal of successful implementation and desired outcomes for welfare programs.

1) Driving inclusivity

Inclusivity in a scheme design or implementation is not a default virtue. It may overlook the most vulnerable and marginalized groups, including women, who may not have access to or may not be reached by these programs.

Strengthen Gram Panchayat Development Plan

To ensure inclusivity in program implementation, targeting multiple specific groups and setting goals for each is essential. The gram panchayat (GP) officials who are elected every five years need to be taught to be data-driven and inclusive. Such training works for GP officials, who can draft better need-based and local context-specific Gram Panchayat Development Plan (GPDP). Specific provisions are made in the XVth finance commission for GPDP regarding the allocation of funds to rural local bodies, the formation of State Finance Commissions (SFCs) in all states, and the appointment of nodal officers and facilitators to prepare plans. Much stress has also been given to data collection, analysis, and updating the GPDP and other related portals.

Involve groups in the planning process

To drive inclusivity, it is crucial to involve women Self-help Group members, farmer producer groups, and youth groups and utilize their increasing influence within their communities. With a collective reach of over 80 million women, SHGs hold a more excellent hold in the community than others. SHG in many states (such as Bihar’s JEEViKA and Kerala’s Kudumbashree, to name a few) are successful examples of SHG-led initiatives that various departments trust to implement schemes and reach out to communities.

2) Building implementer’s capacities 

Cultivate an outcome-focused mindset

Implementers’[1] work with the output mindset, focusing on short-term results. These achievements feed into performance evaluation and appraisals, reinforcing the attention to output. However, their focus can be expanded through coaching and training to include outcomes.

The central ministries are collaborating with NITI Aayog to develop strategic plans and align them with the Output Outcome Framework. Yet, for this approach to be successful, knowledge and capacities must also be built, and insights from lower levels must be gathered by including those directly accountable for implementing the plan.

Encourage data analytics and data reporting

Data-driven decision-making is crucial for both inclusive targeting and effective implementation. It is essential for district officers to utilize data for decision-making and to enhance their skills in three key areas: first, understanding the significance of quality data; second, being able to collect and utilize disaggregated data (based on geography or gender); and third, skilfully employing data in the decision-making process concerning their development programs.

3) Fostering community engagement

Push for Jan Bhagidari

Community engagement, or Jan Bhagidari, is crucial for the success of development programs. Unless the community owns its development agenda (think education, sanitation, nutrition, health, digital payments) and makes complementary efforts, it will be easier for development programs to achieve outcomes. By working with volunteers and leveraging behavior change communication, implementers can engage the community to design and execute activities, assess needs, create awareness, and drive behavior change. However, for implementers, this requires proper selection of community volunteers, setting expectations, creating a supervision and support structure, engaging public representatives and influencers, and continuous support from development partners. We have witnessed that =incorporating the spirit of competition through incentivizing performance motivates the community and its representatives to achieve goals and promote excellence.

Streamline working with development partners

Development partners (including multilateral and bilateral agencies, donors, philanthropies, technical agencies, non-governmental organizations, and civil society organizations) often need to be more utilized by district officials. Their engagement can be more effective when development partners are assigned distinct roles and specific responsibilities with set targets and are held accountable for their work. Moreover, development partners can contribute to skill and knowledge transfer by conducting training programs for implementers and the community.

Overall, the Government can fast-track inclusive development by involving the community development partners, building implementers’ capacities towards an outcome-oriented and data-driven approach, and pushing for inclusivity in implementation.

[1] By implementers, we mean district/block-level officials

Delivering finance better in a humanitarian relief operation: Lessons learned from the Somali Region of Ethiopia

Posted on by The Helix Institute at MSC

The United Nations Capital Development Fund is leading an initiative to enhance the capabilities of Financial Service Providers (FSPs) engaged in humanitarian efforts, focusing on digital payments and agent network services. Our on-the-ground assessment revealed a gap between the needs of humanitarian aid services and the current capabilities of FSPs, prompting a new pilot with MicroSave Consulting that seeks to improve the delivery of Cash Voucher Assistance in a UN World Food Programme relief operation for 65,000 people in the Somali region.  Here’s what we’ve learned. 

In a previous blog highlighted our team’s recent implementation of a project to digitalize Cash Voucher Assistance (CVA) in Ethiopia’s Somali Region. This second blog focuses on the lessons learned throughout the initiative implemented in partnership with MicroSave Consulting (MSC) under the Digital Finance for Resilience (DFS4Res) Programme, funded by the European Union and the Organization of African, Caribbean and Pacific States (OACPS). 

The initiative emphasized the importance of well-established financial service access points, and the challenges related to distribution and the readiness of digital payment service providers. Local agents are crucial in ensuring that individuals without direct access to digital services can receive aid, which improves the efficiency, security, and financial inclusion of the cash transfer process. 

Training and capacity-building efforts have strengthened the network of agents involved in delivering CVA. Key developments from this initiative include fostering connections between agency banking, business banking, and performance measurement within humanitarian assistance. While some institutions have clear business models for agency banking, many still lack awareness at the district and branch levels. The initiative has successfully onboarded over 300 new active agents with the support of the project, particularly through effective agency banking strategies.

Key Lessons 

    • Agency Network Management Processes: Effective management is critical for advancing financial inclusion. Our approach integrates theoretical frameworks, international best practices, and on-ground findings. 
    • Agent Recruitment and Onboarding: Recruiting reliable agents is fundamental to a robust network. Comprehensive training on banking products, service delivery standards, compliance protocols, and customer engagement strategies is essential. Successful practices are seen in countries such as Kenya and India. 
    • Float and Liquidity Management: Maintaining transaction liquidity is crucial for operational efficiency. Effective float management involves monitoring float levels, timely cash replenishments, and providing tools for management, with successful implementations seen internationally. 
  • Monitoring Agent Performance: Regular evaluations and continuous feedback are vital for maintaining service standards and compliance. Ongoing assessments ensure agents meet performance expectations. 
  •  Agent Support Service: Support services, including help desks and real-time troubleshooting, are essential for maintaining service quality and addressing operational challenges. 
  •  Agent Retention: Incentive structures and regular communication are key to retaining high-performing agents. Successful models in countries such as Ghana and Bangladesh illustrate effective retention strategies. 

Key Developments 

  • Periodic Reporting: Most banks have established mechanisms for monitoring agent performance, with regular reports generated by management teams. 
  • Performance Evaluations: Continuous oversight is achieved through regular evaluations conducted by branch and digital managers, ensuring adherence to performance standards. 

Key Challenges 

  • Cumbersome KYC and Eligibility Requirements: Agents face burdensome KYC requirements slowing onboarding processes, which hinders network expansion, especially in rural areas. Many businesses are unregistered, limiting potential agents, and compliance burdens can discourage participation, particularly among women. 
  • Liquidity Management Challenges: Agents often struggle to maintain float levels due to access issues at banks or ATMs. Insufficient cash availability during humanitarian distributions can lead to service interruptions. Additionally, agents limit transactions primarily to airtime sales due to low incentives from other cash services. 
  • Mapping Service Delivery Points with Beneficiaries: Thorough research is needed to align financial services with the needs of beneficiaries. A lack of agents in specific areas limits service delivery, necessitating the recruitment of additional agents to ensure a sustainable ecosystem. 

The training and strategy development provided by UNCDF and MicroSave Consulting, along with the efforts of banks, lay the foundation for a more inclusive financial ecosystem that enhances economic resilience among vulnerable populations. While initially piloted in the Somali region, the intervention has the potential for expansion across Ethiopia, requiring collaboration with humanitarian agencies, government bodies, and beneficiaries to streamline service delivery. 

Humanitarian agencies are not only clients of financial service providers but also play pivotal roles in digitization efforts supported by policies established by DG ECHO. Moreover, telecom operators contribute to infrastructure development, ensuring access to essential services for last-mile beneficiaries. 

The commitment and ongoing efforts of all stakeholders highlight the transformative potential of coordinated action in achieving broader economic development and poverty alleviation goals. 

In conclusion, the insights gained from the Cash Voucher Assistance initiative in the Somali Region illustrate the necessity of fostering a well-structured financial ecosystem. While collaboration among stakeholders is essential for addressing compliance challenges and enhancing liquidity management, commitment to learning and adapting from these experiences is critical. By building on these successes, Ethiopia can serve as a model for future humanitarian interventions, ultimately contributing to poverty alleviation and economic development. 

For more about the project’s context, please click here

Why cash payments are transforming humanitarian aid delivery

Posted on by The Helix Institute at MSC

A two-part blog looking at Cash Voucher Assistance in relief operations in the Somali Region of Ethiopia

Cash transfer programming is increasingly a preferred method of delivering humanitarian aid. Armed with an injection of cash, targets for a humanitarian response can decide how to meet their own needs and respond rapidly when those needs change. What’s more, additional cash in a recovering economy can serve to buoy local businesses, helping to keep local markets healthy when crises become protracted.

Cash transfers empower recipients by allowing them to prioritize their needs: food, shelter, healthcare, or education. This flexibility is critical in diverse and dynamic situations, such as crises where needs can rapidly change.

In addition, Cash Voucher Assistance supports local economies by injecting cash directly into communities, stimulating market activity, and enabling local businesses to thrive. This is particularly important in prolonged crises where traditional aid can undermine local markets. Moreover, cash transfers are often more cost-effective and, logistically simpler and more straightforward to distribute than in-kind aid, reducing overhead costs and ensuring a greater portion of funds directly benefits those in need.

Over the past decade, cash transfer programming globally has seen significant growth within the humanitarian aid sector. By 2016, the UN Secretary-General emphasized that cash transfers should become the primary support method for crisis-affected populations whenever feasible. This recommendation was rooted in the evolving understanding that cash-based interventions often provide more flexible, efficient, and dignified assistance than traditional in-kind aid.

The roots of Cash Voucher Assistance (CVA) trace back to the early 2000s when pilot projects demonstrated their effectiveness in various contexts, including responses to natural disasters and conflicts. By the mid-2010s, numerous large-scale humanitarian organizations had integrated CVA into their standard practices. For instance, in 2015, the UN’s World Food Programme (WFP) reported that CVAs constituted 21% of its food assistance portfolio. Data from the Cash Learning Partnership (CaLP) reveals that by 2018, over USD 5.6 billion was distributed through CVA globally, marking a substantial increase from previous years.

As CVA usage grows, the modes of delivery also evolve. Initially, cash assistance often involved physically disbursing cash to recipients, which posed challenges such as security risks and logistical complexities. However, the proliferation of digital technologies and mobile banking or mobile money has significantly transformed the disbursement landscape. According to CaLP, digital payments are now becoming a preferred method of delivery for the distribution of CVA.

Donors such as the European Union’s humanitarian unit, DG ECHO, are promoting a “Digital by Default” form of humanitarian support distribution while implementing partners such as WFP are piloting digital payment in countries such as Ethiopia and Somalia.  For instance, a 2020 pilot in Somalia demonstrated the effectiveness of this shift, with 63% of all such supports transitioning to digital payments by 2022. While the move towards digital payments has enabled greater speed and scale of response; a study conducted in the Horn of Africa has shown that humanitarian agencies are concerned about the time it takes to establish contracts with financial service providers.

Furthermore, a study conducted in Kenya by the Center for Global Development (CGD) and MicroSave Consulting (MSC) Global shows strong support for offering choices in financial service distribution channels where this is feasible. This choice is also advisable to address the demand of last-mile beneficiaries. Today, financial service providers (FSPs) and mobile money platforms are increasingly being used to transfer funds directly to beneficiaries’ accounts using digital payment solutions.

 

Why digitize payments in humanitarian aid in Ethiopia?

The Ethiopian government has been distributing CVA under the Productive Safety Net Programme (PSNP) since 2005. Notably, it was the first program to use mobile money in mid-2015, after a successful pilot in the Tigray region by the regional bureau office supported by UNICEF (It used the M-BIRR service of Dedebit MFI).  Various organizations, including the World Bank, WFP, UNHCR, Islamic Relief, and World Vision, are involved in these humanitarian interventions.

Despite a substantial increase in account ownership in Ethiopia—from 22% in 2014 to over 46% in 2022 —a significant gap remains, particularly in rural areas, where over 75% of the population still struggles with limited access. The gender disparity is also striking, with only 39% of women owning accounts compared to 55% of men. These challenges highlight the urgent need for strategic interventions to further expand account ownership and improve the services provided to beneficiaries.

 

A critical component of advancing digital ways of distributing CVA in Ethiopia includes Financial Service Providers (FSPs) building a trained and appropriately incentivized agent network. This network, combined with a clear business model and the implementation of a master or super-agent model, can effectively reach small agents at a village level to support financial institutions. In a CaLP study, six bulk payment operators in humanitarian intervention2 reflected that such an agent network management structure is key to planning and managing liquidity for bulk disbursement services. This network should also target female agents in regions such as the Somali region, as their involvement can significantly enhance financial inclusion and gender equality.

Based on these findings and the knowledge of Ethiopian financial service providers, the United Nations Capital Development Fund (UNCDF) is leading an initiative to enhance the capabilities of FSPs engaged in humanitarian efforts, focusing on digital payments and agent network services. A comprehensive on-the-ground assessment revealed a gap between the needs of humanitarian aid services and the current capabilities of FSPs. In response, UNCDF, in partnership with MSC, launched a pilot program involving three FSPs—Commercial Bank of Ethiopia, Shebelle Bank, and Cooperative Bank of Oromia—to improve the delivery of CVA in a WFP intervention supporting 65,000 beneficiaries in the Somali region. The project was implemented in partnership with MSC under the Digital Finance for Resilience (DFS4Res) Programme, funded by the European Union and the Organization of African, Caribbean, and Pacific States (OACPS).

Follow us to go into the details of the lessons learned from this project. 

From food security towards nutrition security – The crucial role of the rice fortification initiative of the Government of India

Posted on by Deepesh Singh

India is at a pivotal moment in its journey towards achieving comprehensive food and nutrition security, particularly through the innovative initiative of rice fortification led by the Government of India. As we face the challenge of malnutrition and micro-nutrient deficiencies, the government has taken significant strides to ensure that our population has access to nutritious food that meets their dietary needs.

The Importance of Food Security

Historically, India has transformed from a nation reliant on food imports to one of the world’s largest agricultural producers. With self-sufficiency in food grain production, India now ranks among the top producers of various crops, including rice, a staple for approximately 65% of our population. The Government of India procures rice, wheat, and millet from farmers for distribution through its social safety net programs. The National Food Security Act (NFSA) plays a crucial role in this transformation by providing subsidized or free food grains to over 813 million people, focusing mainly on vulnerable groups, including pregnant women, lactating mothers, and children under 14.

The Targeted Public Distribution System (TPDS) ensures no individual goes hungry. During the COVID-19 pandemic, initiatives like the Pradhan Mantri Garib Kalyan Anna Yojana (PMGKAY) demonstrated the government’s commitment to food security by providing additional free food grains to those in need. This initiative will continue for five years, starting January 2024, reflecting the government’s long-term vision for addressing national food and nutrition security. This long-term commitment reassures the public and stakeholders of the initiative’s sustainability and dedication to the cause, instilling a sense of security and confidence in the initiative’s future.

Transitioning Towards Nutrition Security

While achieving food security is essential, it is equally vital to transition towards nutrition security. Anemia remains a significant public health concern in India, affecting maternal and child health and national productivity. In response, the government launched the Anemia Mukt Bharat (AMB) initiative in 2018, which includes mandatory provisions for fortified foods in public health programs.

Fortification involves intentionally boosting the levels of key micronutrients—such as vitamins and minerals—in food or condiments. Not only does fortification increase the nutritional value of staple foods, but it also helps to replenish micronutrients that may be lost during food processing.

The government initiated a rice fortification pilot program in 2019, recognizing rice as a staple millions consume. In 2021, on the occasion of Independence Day, Hon’ble PM Sh. Narendra Modi announced that fortified rice will be provided across all government social safety net schemes by 2024. The initiative was thus scaled in a phased manner, accounting for the rice fortification ecosystem and supply chain growth simultaneously to meet the requirements of central government schemes. This ambitious plan aims not only to enhance nutritional standards but also to combat anemia effectively.

Progress and Achievements

The rice fortification initiative has made significant strides, being implemented in phases after the pilot and expanding across various programs such as Integrated Child Development Services (ICDS), school feeding program (PM-POSHAN), and Targeted Public Distribution System. By March 2024, all non-fortified rice in these social safety net programs has been replaced with fortified rice. The program has been evaluated, and the findings have shown promising results, indicating reductions in the prevalence of anemia among children and women in study districts. Buoyed by the results and further need to work on micronutrient deficiencies, the Government of India has recently extended this initiative until December 2028 with a budget outlay of INR 17082 crores. The quantity of fortified rice distributed and the budget outlay of the initiative have increased multifold since the pilot, instilling optimism for the future of nutrition security in India.

Table 1: Giant leap in program implementation and commitment of the Government of India to the Rice Fortification Initiative

Implication for Private Sector: The Rice Fortification Ecosystem developed so far, and opportunities ahead

The rice fortification process involves enriching rice with Iron, folic acid, and Vitamin B12 by blending custom-milled rice with fortified rice kernels (FRK) 1% by weight. Similarly, fortified rice kernels are prepared by adding fortificants (Iron, folic acid, and Vitamin B12) premixes with rice flour and water, and FRK is made through the extrusion process.

The Government, working alongside key stakeholders and industry, has made significant strides in developing India’s rice fortification ecosystem. The infrastructure needed for manufacturing, blending, and ensuring the quality of fortified rice has grown robustly. The country has approximately 925 active fortified rice kernel manufacturers with over 111 lakh metric tons of production capacity annually. Approximately 232 new premix manufacturers have been established in the country. Additionally, around 21,000 operational rice mills are now equipped for blending fortified rice. The Food Safety and Standards Authority of India (FSSAI) has established testing protocols that ensure consistency across laboratories, enhancing the quality assurance process for fortified foods. As of February 2025, there are 57 FSSAI-empaneled NABL-accredited labs for fortified rice testing, 32 for testing Fortified rice kernel, and 13 for testing premixes in the country. The private sector’s active participation and contribution to the initiative are highly valued and integral to its success.

The initiative has been extended until December 2028, with increased yearly blending and a fortified rice kernel requirement. This extension provides policy consistency and a clear timeline for stakeholders to plan their participation in the initiative. It also demonstrates the government’s long-term commitment to the rice fortification initiative, encouraging stakeholders to continue supporting and participating. Moreover, the success of India’s rice fortification initiative has sparked renewed interest from other countries in the Global South, who are now looking to replicate this model in their nations. This opens the doors for the open market fortification of rice and exporting fortificants, Fortified rice kernels, and fortified rice.

Looking Ahead: The Way Forward

Monitoring and evaluating the rice fortification program, including quality aspects and its impact on public health outcomes, is paramount. The Government of India is conducting a time series repeat cross-sectional study to measure the impact of iron-fortified rice on iron deficiency anemia among the targeted consumers. Once available, the results will help refine strategies and ensure effective delivery.

Furthermore, successfully implementing rice fortification benefits the current situation and opens up possibilities for fortifying other staples such as lentils, millets, and other grains with essential micronutrients like iron, zinc, and folic acid. This promising prospect can significantly enhance the nutritional profile of our food supply, offering a brighter future for public health.

Additionally, integrating the provision of other nutritious commodities such as millet, fruits, vegetables, eggs, and milk into the public distribution system’s supply chain through initiatives like Jan Poshan Kendras and promoting sustainable agricultural practices can significantly enhance nutritional security and resilience against future food challenges. Engaging stakeholders at the State level, fair-price shop dealers, and communities about the benefits of fortified staples and a diverse diet can further bolster the program’s success.

Ultimately, a holistic approach that combines fortification with diversification and nutrition education will ensure that India’s population survives and thrives, equipped with the necessary knowledge for a healthy and productive life.

Conclusion

India’s rice fortification initiative marks a significant step towards addressing malnutrition and anemia by integrating fortified rice into social safety net programs. With substantial progress in infrastructure and promising initial results, the initiative is set to enhance nutritional standards nationwide in the medium to long term. Continuous monitoring and the inclusion of other nutritious commodities will further bolster nutritional security and resilience against future food challenges.

This article was first published on the NuFFooDS Spectrum platform on 6th March 2025.

The role CICO agents play in Ethiopia’s social payments

Posted on by Deepesh Singh

Breaking barriers: A study on female cash-in cash-out (CICO) agents and their potential to drive financial inclusion

Posted on by The Helix Institute at MSC

This study explores the critical role female cash-in cash-out (CICO) agents play to advance financial inclusion across nine countries. It identifies systemic barriers that these agents grapple with, such as social norms, limited financial support, and safety concerns. The study provides actionable strategies to improve the recruitment, retention, and performance of female agents through a lifecycle approach to strengthen digital ecosystems.