INCLUSIVE PAYMENTS BENEFITS EVERYONE

Transcription

1 INCLUSIVE PAYMENTS BENEFITS EVERYONE Financial Services for the Poor: Level One Project James Dailey June 18, 2015 Bill & Melinda Gates Foundation

2 THEORY OF CHANGE FINANCIAL SERVICES FOR THE POOR Intervention areas Outputs Outcomes Impact Expand the Digital Financial Infrastructure Expand the digital financial infrastructure so that poor people can access digital money and use it to transact with their peers, businesses, and government Accounts which can connect digitally to other accounts Population within 5km of access point Reduced transaction costs Poor people manage their money digitally Fewer people fall into poverty Drive Participation in the Digital Financial System Create value that results in poor people joining the system because financial service providers design products to meet the needs of the poor and can offer them profitably Foster Regulations and Policy Adapt regulations to enable poor people to open accounts, to allow providers to outsource distribution, and to protect users <$2/day adults use a digital account Digital bulk payments Number/type of financial products available digitally Reforms adopted on e- money account issuing, KYC requirements, and distribution By 2035, 80% of adults worldwide and 60% of < $2/day adults actively use a digital account to access at least one financial service beyond payments (credit, savings, insurance) More More people move move out of poverty faster Bill & Melinda Gates Foundation 2

3 What If WHAT IF? FSP INNOVATION LANDSCAPE 1 Customer Activation 2 Distribution 3 Payments Front- 4 End Payments Back- End We could turn a 30 day sign up process into 30 seconds? Everyone was an agent? Anyone with a phone could send or receive money? Payment processing was digital and close to zero in cost? Integration Products Analytics 8 Enabling Regulatory Environment You could send money to any person in the world? Every mobile phone came with a savings account and insurance? Assessing risk for a billion new customers was cost-effective? A pro-poor regulatory environment facilitated financial inclusion? Bill & Melinda Gates Foundation 3

4 Lower Income DFS System Reference Model Lower Income Digital Financial Services Providers Na;onal Digital Financial Services System Digital Financial Services Providers Agents Account Opening Service Interoperability Service for Transfers Account Opening Service Agents Consumer Account Management Fraud and Risk Management Service Consumer Account Management Small Payees Schools Clinics) Agent and Merchant Account Management Small Payees Schools Clinics) Higher Income Higher Income Large Payees U;li;es Hospitals) Card Networks ACH RTGS Large Payees U;li;es Hospitals) Large Payers (Governments Employers NGOs) Retail and Commercial Banks Central Bank Retail, Commercial, and Se:lement Banks Large Payers (Governments Employers NGOs) 4

5 ROADMAP Apps Innova;ve Applica;ons, Products & Services Enable market ecosystem innova8on that delivers affordable, effec8ve pro- poor services and products across sectors such as health, educa8on, agriculture, retail, small & medium enterprises. Accounts Digital Accounts & Transac;ons Enable easy and efficient account opening, account access and effec8ve digital financial services for consumers, agents, merchants and providers of payments and payment processing services. Rails Infrastructure for Connec;vity, Interoperability, Clearing, Se:lement Design, deploy and operate a robust digital financial services infrastructure that enables real- 8me transac8ons, efficient end to end interoperability across many market par8cipants while ensuring adequate fraud and risk management controls are in place to protect individuals and par8cipants. Rules Regulatory and Governance Framework Establish Legal and Regulatory Framework to ini8ate and sustain digital financial services scheme and pla=orm ensuring safety, security, efficiency and innova8on while reaching the lowest income ci8zens with extremely low cost services. Bill & Melinda Gates Foundation 5

6 DFS ROADMAP Use Cases Screen Setup Telenaira NigeriaCom World Food Program User s Phone IST Se:lement Bank Make Bulk Payments to Anyone NGO/GO Portal Make bulk payment Self- Issue Send Money to Anyone Bolajy opens account with naronal ID, sets PIN P2P to Dupe for 135 using phone number Observe alt ID Observe fee transparency Observe account limits Buy Things from Any Merchant USSD Emulator of Pa;ence s Phone or Smart Phone PaRence (Merchant) requests payment from Bolajy for 75 using alt id NGO/GO Portal: Generate Report Observe Pending status for Bolajy Bolajy Eze Dupe Eze Pa;ence Chukwu Individual Individual Merchant MFSP Telenaira MFSP Nigeriacom MFSP Nigeriacom Phone Number Phone Number Phone Number DOB 16/04/1976 DOB 16/04/1977 DOB 08/02/1975 Na;onal ID Na;onal ID N/A Na;onal ID N/A Alt ID Alt ID Alt ID Observe successful payments status Review detailed errors SMS: Bolajy s phone Receive SMS saying he has a pending payment and needs to open an account using the aqached short code SMS: SMS: Dupe s Phone Receive SMS indicarng a payment has been received, amount and payer Receive SMS to confirm payment amount and payer Check pending transacrons and approves transacron with PIN Observe fee transparency SMS: Pa;ence s Phone PaRence gets SMS to confirm payment Keep Money Secure. Check Balance. Run mini statement to see balance and a summary of all transacrons, including fees

7 LEVEL ONE PROJECT ( Design Principles for the Digital Payments System Open loop Immediate Funds Transfer Same day Settlement Push Payments Open, international standards Irrevocability Shared fraud service Tiered KYC