Call for proposal Consultancy services in implementing Digital Financial Services in partnership with PAMIGA
June 2017
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Contents Abbreviations .................................................................................................................................. 3 1.
About PAMIGA ................................................................................................................................ 4
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Objectives of the DF project ........................................................................................................... 4 2.1 RENACA ......................................................................................................................................... 4 2.2 CECAM........................................................................................................................................... 4
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Proposed Approach and Key Success Factors ................................................................................. 5
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Roles and tasks of the consultancy ................................................................................................. 5 4.1 Roles .............................................................................................................................................. 5 4.2 Tasks and deliverables .................................................................................................................. 6
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Governance ..................................................................................................................................... 7
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Duration of the project ................................................................................................................... 8
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Expected outcomes ......................................................................................................................... 8
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Response format ............................................................................................................................. 8
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Selection criteria ............................................................................................................................. 8
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Abbreviations DF – Digital Finance FI – Financial Institution MFI – Microfinance Institution MIS – Management Information System MNO – Mobile Network Operator
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1. About PAMIGA PAMIGA (Participatory Microfinance Group for Africa) is an international non-governmental organization operating since 2005. Based in Paris, Dakar and Nairobi, PAMIGA aims to contribute to unlock the economic potential in rural Africa, by promoting the growth and sustainable development of existing financial intermediaries that serve rural areas. To achieve this goal, PAMIGA supports its network member MFIs to implement Digital Financial solutions that promote financial inclusion, provide secure operations and reduce operational costs.
2. Objectives of the DF project The overall objective for this project is to “Ensure a sustainable growth in the MFIs selected, by reaching new geographical areas and underserved clients” through the use of Digital Financial services. The scope of this proposal will be confined to 2 MFIs that are RENACA in Benin and CECAM in Madagascar. Below is a short description of each MFI and the DF solution to implement:
2.1 RENACA RENACA is the Beninese national apex of the Caisses Villageoises d`Epargne et de Crédit Autogérées (CAVECA), Self-managed Village Savings and Credit Association in English. Created in 2005, the network is composed of 8 CAVECAS and 24 service outlets mostly set up in rural and peri-urban areas and reaches out to over 100,000 clients. RENACA’s business strategy is to be having profitable and efficient operations that are automated. By 2019, RENACA would like to improve the quality and availability of information from its MIS and facilitate repayment of loans by its members thus improve portfolio quality. RENACA also plans to facilitate savings mobilization from its members. To achieve these business strategies, RENACA plans to deploy innovative ways by implementing digital finance solutions, starting with a Mobile Banking solution. RENACA will partner with one or two Mobile Network Operators (MNO) for example MTN or MOOV and link the RENACA MIS with the MNO platform. This would enable RENACA clients to use the e-Wallets of the MNOs to repay their loans or savings. Alternatively, RENACA can use the agent network of the MNO to allow its clients to deposit, and repay their loans using the e-wallet of the MNO. The client, without the need to move to RENACA offices, can do all transactions on the phone. The transactions will be updated in RENACA MIS regularly.
2.2 CECAM CECAM is a Malagasy MFI mutualist which mission is to build a viable and professional financial institution and be an integral part of Malagasy financial sector, to sustainably provide local financial and non-financial services, adapted to the needs of rural and urban areas while paying particular attention to the integration of women. The network has a strong rural vocation: 85% of rural clients. At the end of 2016, CECAM has around 87 000 active clients for a total loan portfolio of 20 million Euros, ranking it the second largest MFI of the country. With 85% rural cliental, CECAM plans to use digital finance as a tool to enhance financial inclusion. CECAM therefore has several digital finance objectives that they want to achieve amongst which is the deployment of a network of external agents out of the traditional MFI branches and points of 4
services. Those agents will offer financial services to CECAM customers in remote and isolated areas, which will increase the MFI geographical coverage and secure financial services. CECAM will enter into partnership with a digital finance operator such as a MNO. This digital finance solution requires linking the MFI MIS to the MNO platform. An interface must be built between the MFI and the MNO systems to update member transactions on real-time basis on both sides. CECAM will not only use the agent network of the MNO but also its own external agents to allow its members to make financial transactions by first charging their e-wallet and then making the transaction on their account CECAM.
3. Proposed Approach and Key Success Factors The implementation and management of digital financial services for FIs require a broad spectrum of knowledge and skills. For the success of the project, PAMIGA is seeking to work with an experienced consulting firm or individual consultants that will complement and work collaboratively with PAMIGA technology team, the two MFIs and all the stakeholders (technical providers, vendors and other partners of the project) to achieve the objectives of the project. The selected firm will work hand in hand with PAMIGA throughout the entire project on agreed terms on a signed agreement with clear deliverables.
4. Roles and tasks of the consultancy 4.1 Roles The consultants/consulting firm will work collaboratively with all stakeholders – vendors and other partners in the project. In general, the role of the chosen consultants/firm is to support PAMIGA Technology department in the deployment of Agent Banking model in CECAM and Mobile Banking Solution in RENACA at all the steps of the project: 1. Support in pilot testing, checking and verification: To refine any necessary actions before the commercial launch and implement a pilot to validate the choices made. This task will involve internal and external activities for both MFIs as follows: a) Definition of the testing strategy plan, including i. Integration tests definition ii. Validation tests definition iii. On site tests definition iv. Definition of the testing environments (including the identification of all hardware and software configurations necessary to achieve the testing activities) in accordance with stakeholders (MFI, vendors, regulators, other third parties) v. Planning of testing phases (integration, validation, on site) b) Approvals and validation with the regulators and other stakeholders c) Internal Guidance, growth and training of teams this means transition from Pilot to roll out phase. d) Roll out plan and Marketing & Communication materials. 2. Support in project launching: After the pilot phase, some business processes may need to be updated. The expected role of the consultant / consulting firm for both MFI will be as follows: 5
a) Training of teams needed (additional partners, agents and more) b) Launch of all communication actions c) Monitoring performance and risks, based upon the “DF performance and risks indicators” defined 3. Performance improvement: This will involve monitoring performance of the proposed DF services and developing optimization plans, including: a) “DF performance and risk” indicators Control b) Recommendations for improved performance c) Recommendations for the roll out plan and improvement plan
4.2 Tasks and deliverables To support PAMIGA and the MFIs to implement the 2 DF solutions, the consultant / consulting firm will be in charge of the following tasks: 1. Agent Banking Model with CECAM : In the implementation of the agent banking model, the consultant/consulting firm will be in charge of: a) Agent selection, recruiting and training b) Definition of agent business processes, including registration, service, and cash management c) Designing agent incentive structures d) Recommendations on Liquidity management e) Defining agent monitoring, quality control, and auditing f) Partner recruitment and negotiations (i.e. organizations that use or promote the service or assist in implementation) g) Defining sales and service incentive structures h) Designing business process mapping i) Check that the agent banking system is correctly interfaced with the MIS j) Assist CECAM for change management and transition to electronic payment The expected deliverables are as follows: a) b) c) d) e)
Training plans and training materials Training of all necessary teams (partners, agents, internal staff) Policies and procedure manuals Recommendations on marketing and branding Launch communication activities for the pilot phase like how adverts should be formulated and presented to members f) Definition of control dashboard of “Third party performance and risk indicators” g) Detailed implementation plans h) Testing strategy plans (detailed in 4.1.1.a) i) Roll out plan and Marketing & Communication materials j) Internal Guidance materials k) Monthly project reports
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2. Mobile Banking Model with RENACA For the implementation of the mobile banking model, the consultant will work hand in hand with the technical developers and the selected MNOs and ensure that the project is successfully implemented. Specifically, the consultant/consulting firm will oversee that: a) The functional and technical specifications are well documented and understood by the developers b) The integration of MNO platform and MFI MIS is successful c) The MFI policies, procedures are updated d) The specific internal controls are in place to reduce fraud e) The training of staff, external agents and clients has been undertaken using best practices methods The expected deliverables are as follows: a) b) c) d) e) f) g)
Detailed functional and technical specification document Internal business processes Training plans and training materials Training of all necessary teams (partners, agents, internal staff) Policies and procedure manuals Recommendations on marketing and branding Launch communication activities for the pilot phase like how adverts should be formulated and presented to members h) Definition of control dashboard of “Third party performance and risk indicators” i) Detailed implementation plans j) Testing strategy plans (detailed in 4.1.1.a) k) Roll out plan and Marketing & Communication materials l) Internal Guidance materials m) Monthly project reports All deliverables will be submitted to PAMIGA for formal approval before submitting to the MFI. Monthly project reports will be provided to PAMIGA and then be used as the support of the monthly Project Committee (see § Governance).
5. Governance For each MFI, the firm selected will participate to 2 two kinds of Committee: Project Committee: Purpose and objectives: follow-up of the project, difficulties and problems fixing, performance and risk follow-up, risk escalation Attendees: Project Manager of the firm selected, PAMIGA IT Director, MFI Project Manager, MFI IT and Business representatives Frequency: twice a month
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Steering Committee: Purpose and objectives: in coordination with steering committee of the MFI project, escalated risk solving (proposals), follow-up of the firm and PAMIGA coordination (sharing of strategic vision on the project) Attendees: Manager (or representative) of the firm selected, Project Manager of the firm selected, PAMIGA General Manager, PAMIGA IT Director Frequency: monthly
6. Duration of the project The firm selected will support PAMIGA for the total duration of each project PAMIGA is working on with each MFI. For RENACA: Expected duration of the project is 9 months, starting on July 17th. The bidder should propose an alternative duration if needed. For CECAM: Expected duration of the project is 9 months, starting on August 1st (to be confirmed). The bidder should propose an alternative duration if needed.
7. Expected outcomes The consultant will provide a monthly report outlining the status of the project, recommendations and lessons learnt. At the end of the project, it is expected that CECAM has developed a network of external agents through agent banking and RENACA have developed mobile banking.
8. Response format The consulting firm should respond with a technical and a financial proposal using the outline below:
Presentation of organization, giving background of the organization and indicating its experience in DF; Approach, methodology and timetable; Project Organization; Profiles of the team that will work on this project; Work Plans. The consultant/firm should be fully committed and available to the project during this period; Detailed financial offer, including perdiems, daily fees per profile, number of days per profile, total indicating payment terms; Curriculum vitae of team members; Reference with contacts details
9. Selection criteria The following criteria will be used to assess the offers received:
experience in Digital Finance experience in Microfinance awareness of local context local proximity for both MFI understanding of the needs cost of the consultancy service proposed 8
This proposal should be sent to
[email protected], copy
[email protected] by 30TH June 2017. A session of presentation and questions will be organized during the week of July 10th, and the final response will be given by July 13th. Please note that the consultant/consulting firm MUST be excellent in French both spoken and written. --------------end-----------
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