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The New NGO C-Suite: Unlocking Efficiency, Control and Transparency
In response, forward-thinking beneficiary
organizations are finding new ways to disburse
and manage their funds. Taking cues from their
for-profit counterparts, they are replacing
cumbersome cash and paper-based payments
with electronic transactions, even in the remote
under-banked regions of emerging markets.
They are adopting more sophisticated foreign
exchange practices and embracing advanced
electronic banking and reporting systems.
Mobilizing field operations
In recent years, mobile phone technologies have
had a huge impact on how major humanitarian
and development organizations conduct their
business, particularly in far-flung corners of the
world. Take for instance one international health
organization that leveraged the advanced state
of mobile communications networks in Africa to
transform activities as diverse as how it tracks
and treats malaria to how it manages local cash
disbursements.
A specialized mobile phone interface provides
health officials in local communities a means
of reporting data that is critical to identifying
and responding to malaria infections in real
time. Field operations use cell phones to quickly
transmit information that provides insights into
malaria burdens at the local level and drives
faster, more targeted interventions.
Much of the organization’s work is conducted
in communities with little or no formal banking
services and where, historically, local payments
have been cash-based. Today, thanks to the
development of mobile payments capabilities
in a growing number of developing countries,
field workers can receive funds quickly and
securely via their mobile phones to meet local
administrative and operating needs.
Changing the financial paradigm
Mobile network operators, recognizing a chance
to change the financial paradigm in countries
such as Kenya, have been joining forces with
banks and non-bank local agents to create
mobile payment services for unbanked and
under-banked populations. Kenya, a pioneer
in mobile payments, can now lay claim to one
of the most sophisticated mobile payments
systems in the world as the majority of
households in the country use mobile phones
for funds transfers.
In this sub-Saharan country, for-profit and not-
for-profit organizations alike are seizing the
opportunity to convert local, predominantly
small-value payments from cash to “mobile
wallet” transactions (“m-payments”). These
m-payments are initiated and tracked via
integrated electronic payment and banking
services from providers such as Citi, potentially
reducing the risks and inconvenience of
physically transporting currency, sometimes
over long distances, and dealing with paper-
based records and reconciliations. Electronic
payment processes provide more control over
funds and make it easier to get the right
amount of currency at the right time to the
right locations in Kenya. They also provide
the added benefits of real-time visibility into
payment transactions, easier reporting, plus
streamlined auditing of remote payments and
verification of payees.
Bottom line, the switch to mobile payments has
the potential to benefit multiple stakeholders.
They help organizations optimize their cash
flow and cash disbursement processes for local
payments, while also providing them — and
even their aid donors — greater visibility and
accountability into funds flows. Plus, payees
can receive timely secure payments through a
familiar, convenient channel that reduces the
risk of loss or theft.