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Highly Commended

Best in Class Treasury Solution in Africa, Treasury Today Adam Smith Awards 2018

NSSF Uganda

Uganda

Customised FX solution is first of its kind in Uganda

Company profile

The National Social Security Fund (NSSF Uganda) is a national saving scheme mandated by government through the National Social Security Fund Act, Cap 222 (Laws of Uganda) to provide social security services to employees in Uganda.

The challenge

The key challenge that NSSF Uganda faced was regarding the payment of foreign currency benefits owed to expatriates returning to their home country from Uganda. This presented some unique challenges at the point of processing these benefits, due to the highly manual cross-border payments process as well as limited foreign currency capabilities to fund non-core currencies in particular.

NSSF Uganda therefore required a fully automated foreign currency benefits solution that would enable it to minimise processing time, rationalise foreign currency accounts, electronically book a foreign exchange rate and ultimately ensure settlement of contributions to expatriates in a timely manner.

The solution

NSSF Uganda utilised Citi’s WorldLink payment solution to automatically process all foreign currency benefits to beneficiaries via a single Ugandan Shilling (UGX) account. NSSF Uganda funds its Worldlink account with the aggregated UGX equivalent for the FX transactions and uploads the file straight from its ERP (JD Edwards) to CitiDirect BE®.

The bank’s Worldlink platform then books a spot exchange rate for the required foreign currency pairs and executes the transactions as per client instructions. The end-to-end payment process is complete once NSSF receives access to WorldLink reports for enhanced reporting and reconciliation.

Best practice and innovation

NSSF Uganda is able to demonstrate foreign exchange best practice and payment innovation through multiple key aspects centred around automation, straight through processing, reconciliation, time efficiencies and scalability.

The eradication of a highly manual cross-border payment process that was previously exposed to human error and time lags was replaced with an automated end-to-end foreign exchange solution via Citi’s WorldLink® product. This enables a fully electronic delivery channel that accommodates the FX process from payment initiation to exchange rate booking to payment execution.

NSSF can now completely eradicate the need for foreign currency accounts by utilising a single functional currency account to fund all cross-border obligations for expatriates. This further enabled simplified reconciliation via WorldLink reporting that is delivered in multiple file formats directly to NSSF Uganda’s ERP system, JD Edwards.

The WorldLink solution also gives NSSF Uganda access to a wider range of currencies for settlement including exotics as opposed to the common G-10 currencies – this created payment and costefficiencies by allowing for a single currency pair to be exchanged as opposed to having multiple legs of conversion. Furthermore, NSSF Uganda has now implemented a scalable FX solution that has the capacity to process and execute thousands of cross-border benefits seamlessly which may become the norm moving forward in Uganda, as the expatriate population continues to increase off the back of continued economic growth in the country.

Key benefits

  • Simplified cross-border payment process that has transitioned from requiring three different platforms for processing to a single payment module.
  • Potential reduction in human error.
  • Streamlined integration of electronic banking platform to ERP for enhanced host-to-host connectivity between both parties.
  • Improved client satisfaction for NSSF’s beneficiaries who have been able to receive their contributions within days of arriving back in their home country.
  • Access to over 130 currencies for settlement purposes including exotic currencies.
  • Over US$20m worth of cross-border benefits to date.
  • 20%-25% reduction in time spent processing these foreign currency payments; this has significantly improved the operational efficiency of the benefits management team and enabled individuals to devote time to other critical matters.
  • Reduction in the turn-around time for executing cross-border payments by 72 hours from nearly four days previously down to 24 hours, which is market-leading in Uganda.