Oxfam and Visa team up for an innovative payment solution for disaster-affected communities
Amy O Donnell ICT in Programme Lead, Maria Theresa Nina Espinola Abogado DRR Programme Manager - Electronic Prepaid Solution
12th May 2015
A partnership between Oxfam and Visa is providing financial access to disaster-affected communities in the Philippines. Here, Amy O'Donnell and Niña Espinola-Abogado explain how the Electronic Prepaid Solution (EPS) came into being and how the system works.
Since the aftermath of Typhoon Haiyan (local name: Yolanda), Oxfam in the Philippines has been looking for ways to improve the efficiency, security, transparency and speed of aid distribution to disaster-affected communities. This has led to a partnership with Visa and others from the private sector. Between December 2014 and April 2015 Oxfam distributed 2,700 pre-paid visa cards through which $188,023 USD were transferred to vulnerable households.
Oxfam Country Director in the Philippines, Justin Morgan, explained in a project stakeholder's meeting that 'access to money is vital during disasters especially when livelihoods and the local economy are severely affected'. The Electronic Prepaid Solution (EPS) Project was developed to support the cash transfer programming during emergencies in a simple and efficient way. 'access to money is vital during disasters especially when livelihoods and the local economy are severely affected'
The electronic prepaid system has been tested in Oxfam's current programme areas in Tacloban City, Leyte and in the municipalities of San Sebastian, San Jorge and Catbalogan City in Western Samar. Cards have pre-paid funds on them 24 hours before the scheduled distribution, so when they are handed over they are ready to use immediately. We have seen that the
community members are using the cards at ATMs, remittance agencies and in shops that accept Visa. It quickly dispels the myth that some of the poorest in the community are not ready for the banking system.
The project has benefits for both Oxfam and Visa, as Visa's Guam and Philippines Country Manager, Stuart Tomlinson, explains: 'Visa's mission is to provide financial access to everyone - everywhere - and this will become a reality only when we are serving people at the bottom of the economic pyramid, as well as the top. But it will take new kinds of partnerships to enable that network to reach those who have been excluded due to the challenges of remoteness and infrastructure connectivity. This project is a great example of how the world's largest payments technology
company and the world's leading humanitarian organization harness our collective resources to innovate and overcome financial challenges during disasters.'
Visa's Head of Financial Inclusion in Asia Pacific, Ihab Zaghloul, also mentioned that the Oxfam-Visa flagship project sets the bar for Visa's regional work in financial inclusion. Partnership with leading organizations, such as Oxfam, merchants, banks, central banks, legislators, mobile operators, micro-finance institutions and others to develop and bring useful products and services to people, and the education
on how to use them effectively and sustainably, is part of their key roles.
The uses of prepaid cards were tested in both rural and urban settings with different Oxfam disaster recovery and rehabilitation programmes. The card was designed for a number of uses including withdrawal from bank automatic teller machines (ATMs); withdrawal from partner remittance centres; over-the-counter purchases with local merchants; and purchases through a mobile store set up 20km from the city. Customer services, through agents or through an interactive voice response system (IVRS), are also offered to support beneficiaries to inquire about fund
balance, or transaction history, or to change their PIN....common items bought by beneficiaries were water, sanitation and hygiene items, food, and medicine.
Our monitoring survey showed that beneficiaries used the prepaid card for cash withdrawal and purchase through point-of-sale (POS). First time prepaid card users reported 100% success with their transactions. A card activity report also showed that 63% of beneficiaries used ATM machines to withdraw cash. Meanwhile, in Tacloban City, there was a 95% increase in the use of cards for purchasing with partner merchant stores from December 2014 to January 2015.
Partner merchants said that the common items bought by beneficiaries were water, sanitation and hygiene items, food, and medicine. Another interesting piece of data showed that two months after distribution, 45% of the cards still had fund balances of $15-20. Beneficiaries reported that they kept money on the card as savings for their 'disaster emergency fund' and for future livelihood investments.
The system is helping to empower disaster-affected communities by giving them the capacity to make their own financial decisions. Moving forward, Visa is interested in continuing to working with Oxfam. This includes scaling up the project and exploring more innovative ways of delivering payment services that will support post-disaster recovery, as well as sustain livelihood programmes and financial inclusion.
The Electronic Prepaid Solution (EPS) Project started last July 2014 and distributed prepaid cards from December 2014 to April 2015. For more information, contact Niña Espinola-Abogado, Project Manager for Electronic Prepaid Solution at firstname.lastname@example.org.