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Post Archieves

NCSL and CEFI sign MOU for Financial Literacy Training

Financial information is vital to making informed decisions and NASFUND Contributors Savings and Loan Society (ncsl), as a financial institution, endeavours to provide necessary training and awareness to empower people to make good financial decisions.

On Monday August 1, ncsl and Centre for Excellence in Financial Inclusion (CEFI) signed a Memorandum of Understanding for Financial Literacy Training.

Under the MOU, CEFI will provide a ‘Train the Trainers’ program to ncsl staff to empower them to go out and conduct educational awareness on financial literacy to the Society’s growing membership.

CEFI’s Financial Literacy Program will train ncsl officers on how to facilitate and deliver financial literacy information to its members so they are empowered to make appropriate financial decisions, including accessing the right types of financial products and services that address their business and household needs at reasonable costs.

ncsl Chief Executive Officer, Vari Lahui said ncsl is pleased to partner with a recognised institution in the country that specialises in financial literacy training and is also mandated to drive programs on financial inclusion.

“Through our Lending, we have noticed that our members entering into numerous borrowing arrangements with other financial institutions at exorbitant costs and we believe the partnership with CEFI allows us to gain the knowledge and experience to reach out to our members in such situations and assist them with advice,” he stated.

CEFI Advisor, Saliya Ranasinghe said CEFI is privileged and happy to partner with the most innovative and progressive society in the country.

“We are very pleased to work with the largest savings and loan society by membership size to train staff and clients to make a difference in the community through this program.

“Financial literacy is something everybody in this country needs. PNG has a lot of money but the problem is how to manage it. This partnership between the two organisations now enables progress towards better managing the issue of better financial management,” Ranasinghe said.

The MOU will initially run for a period of 12 months and ncsl aims to reach out to as many members as possible and will provide progressive monthly updates to CEFI as part of the agreement with the aim of enhancing the Program where necessary.

Media Releases

Launching of the Third National Financial Inclusion Strategy 2023-2027

The third National Financial Inclusion Strategy 2023-2027 was launched at the Hilton Hotel on 25th April, 2023 by the Chief Secretary, Ivan Pomaleu, OBE.

The Chief Secretary was honoured to launch the 3rd National Financial Inclusion Strategy (NFIS) 2023-2027 at this great event, stating the importance of Financial Inclusion in the country.

“We (the government) believe that financial inclusion is key to integrating the unbanked into the formal economy, which helps to alleviate poverty, make the poor less vulnerable to financial shocks, reduces economic inequality and raises living standards for all,” said the Chief Secretary.

The Chief Secretary emphasized specifically on how the NFIS is receptive to global trends, emerging issues, digital financial services and gender.

Mr. Pomaleu also highlighted the importance of the financial inclusion strategy in embracing the green finance policy and contribution of financial inclusion in financial stability for the unbanked and underbanked individuals and small businesses.

He said financial inclusion is the development priority for the government due to increase in income inequality between the lower- and higher-class societies.

“Financial inclusion is one of the key enablers of many of the Sustainable Development Goals by the United Nations and serves as a powerful element for progress in education, health and other basic public needs, as well as contributing even to climate change and sustainable development,” he said.

Bank of Papua New Guinea Acting Governor, Mrs. Elizabeth Genia in presenting the NFIS stated that the Bank recognises that expanding financial services can encourage the participation of more Papua New Guineans, especially those in rural areas and urban settlements, in development activities in both the formal and informal sectors of the economy, and that the benefits of growth and technology need to be widely shared.

“Many Papua New Guineans find themselves on the fringes of the monetary economy with little understanding of, or access to financial services. Improvement in the proportion of the banked population and the financial literacy of this population will empower them to improve outcomes in savings, investment and sharing of the benefits of economic growth,” said Mrs. Genia.

The Acting Governor stated that the overall objective of Third National Financial Inclusion Strategy (NFIS3) is to reach 2 million unbanked population by 2027 of whom 50% will be women.

“It’s also important that the strategy focuses on reaching our women and youth. Access to financial services for women and youth will remain a challenge. As indicated in the strategy, use of new technology and innovative business models will overcome barriers to access and improve inclusion for women and youth,” said the Acting Governor.

Assistant Governor, Financial System Stability Group – Bank of PNG, Mr. George Awap thanked and commended the stakeholders for recognising financial inclusion as an essential component of Papua New Guinea’s development plan.

“The Central Bank embedded various initiatives in PNG to fight financial exclusion can be traced back to the development of National Financial Inclusion and Financial Literacy Strategy 2014-2015 followed by the Second National Financial Inclusion Strategy 2016-2020,” said Mr. Awap.

“Building on the success of the first and second national strategy implementations and lessons learnt in the process, CEFI and BPNG developed the third NFIS 2023-2027,” he added.

CEFI Financial Inclusion Advisor, Mr. Saliya Ranasinghe, was grateful to the institutions that participated in the studies of the third NFIS strategy.

“The NFIS basically outlines building capacities, establishing partnerships with public and private sector creating space for innovation and using technology to reach the unreached,” said Mr. Ranasinghe during his NFIS presentation.

Mr. Ranasignhe in his presentation of the NFIS, highlighted the main strategic objectives which were, build financial competency through financial literacy and education, create an enabling policy and regulatory environment, develop effective public and private sector engagement, develop an enabling environment for inclusive green finance and deepened financial services.

Chief Executive Officer’s from nine financial institutions, including BSP, Kina, Westpac, Digicel, Savings and Loans Federation, Nationwide Micro Bank, Womens Miro Bank, People’s Micro Bank, Kada Poroman Microfinance, participated in a signing of contract ‘I-Commit’ with the Acting Governor of the Bank of PNG, Mrs. Elizabeth Genia.

I-Commit (Institutional Commitment of Measurable Inclusion Targets) is a set of measurable commitments by the financial service providers to achieve financial inclusion targets and thereby contribute to sustainable and inclusive economic growth in PNG.

The launch ended on a high note with the announcement of the Financial Inclusion Excellence Awards (FIEA) by the Assistant Governor, FSSG Mr. George Awap.

The awards will be given in the following categories: Financial Inclusion and Deepening Award, Financial Innovation Award, Inclusive Green Finance Award, Financial Inclusion Media Contribution Award, Financial Inclusion Advocate Award and the Financial Inclusion New Player Award which will be awarded in November 2024.

Impact Stories

Impact story 3 – Market for Village farmers

Livelihood training inspires farmer Kevin to lead money management training for young farmers.

Farmers in rural communities in Jiwaka Province rely on farming for their livelihoods, but many face challenges transitioning from semi-subsistence farming to market-oriented agribusiness. Coupled with limited financial services & products and poor money management skills, it can be overwhelming for farmers to grow and sustain their farming business.

Kevin Yehi, a lead farmer in Jiwaka is looking at addressing this issue, with his focus on youth farmers. In 2005, Kevin left formal employment in the city and headed to the province to set up his vegetable farming business. Kevin never imagined that his small farming business would one day inspire him to establish the Jiwaka Youth in Agriculture (JYIA) in Kudjip Rural Local Level Government, Angalimp South Waghi District.

“Seeing that there are decent earnings from farming the land, I decided to set up the youth association which supports young people venture into farming as a business.”

Fifteen years after the establishment, the association now supplies watermelon, capsicum and citrus fruits to the Mount Hagen Main Markets, Highlands Fresh, JP Investments, PAK Vegetables and to catering contractors. The organic produce is also sold to Porgera Mine and CPL Group through Highlands Fresh (Tininga Limited) and JP Investments.

There, however, needs to be more work on changing youth financial behaviour. Kevin explains that young farmers gain significant income from the vegetables they sell to the organised markets, but they misuse or poorly manage their income.

“My dream is to see more young people build and live in permanent houses and excel in agribusiness. I think critical money management training will help the youth manage their money well and live a fulfilling life.”

The Centre for Excellence in Financial Inclusion (CEFI) in partnership with the Market for Village Farmers (MVF) project and CARE International-PNG is training lead farmers like Kevin and other trainers to help build the capacity of rural farmers to improve their livelihoods.

Kevin was part of 25 trainers who underwent a two-week Village Farmers Livelihood Improvement Training of Trainers program in May 2021. The Village Farmers Livelihood Improvement Training addresses the attitudes often prevalent in farming households that result in women and youth unequal participation in important decision-making for the family, including managing family income and participation in training and learning opportunities.

“This training is added value for me as a lead farmer,” Kevin beams after his certificate presentation. “I can confidently train young farmers to approach farming as a family business.”

CEFI through the Market for Village Farmers Project will facilitate the access of 25,000 farming households to financial training, services and products across Western Highlands, Jiwaka, Simbu and Eastern Highlands in the Highlands region and Morobe and East New Britain provinces. CEFI will roll out money management skills, develop community-level savings and innovative lending schemes that will pave the way to support farmers to build a strong savings culture and grow their businesses into viable commercial businesses.

Market for Village Farmers (MVF) is executed by the Government of Papua New Guinea through the Department of Agriculture and Livestock (DAL) and implemented by Fresh Produce Development Agency, with funding from the International Fund for Agricultural Development (IFAD).

Impact Stories

Impact Story 2 – Cecilia Pepson

How digital business and finance education has revived the business of a determined woman entrepreneur after the Covid19 pandemic and sparked a passion for financial inclusion in her village.

It was January 2020 and the world was on lockdown. The Novel Corona Virus had swept over the world striking down millions of people. There was a pandemic on the loose. And it was not just human lives that were affected.

The global economy had come to a standstill. Restrictions on the movement of people meant businesses could not sell goods and services.

The results would be devastating for all businesses, sectors and people alike worldwide.

Micro Small and Medium Enterprises (MSME) in Papua New Guinea were the hardest hit.

As the hold of the pandemic slowly eased and the world slowly began to re-open, many businesses would struggle to recover without help.

However, embracing innovation proved to be the game changer for many business owners in the recovery process.

Cecilia Pepson, a businesswoman in the Port Moresby Real Estate Industry, is one such case.

Originally from the Autonomous Region of Bougainville (ABG) and married to a man from the Western Highlands Province, Cecilia owns and manages the Harbor View Apartments in downtown Port Moresby.

She had a thriving business which she started in the year 2004 providing accommodation to expatriates and tourists.

Before the year 2019 ended, the looming pandemic would see all her foreign tenants packed and headed back home overseas.

Just like many MSME owners, Cecilia was not ready for that. She was not a business professional with a college education to help her respond strategically. She was just an entrepreneur that made an income from renting her apartments. As the first months of 2020 came, her revenue stream had dried up as borders were closed and the shutdown of cities became effective.

What pushed Cecilia into becoming an entrepreneur was her desire to support her husband and afford the best education they could for their children.

Her husband was a former diplomat, Ambassador Gabriel Pepson.

For ten years, her children had been exposed to quality education in Europe where her husband was posted as the PNG Ambassador to the European Union. When his term ended and the family returned to PNG, Cecilia shunned the thought of her children missing out on quality education she knew existed overseas. But to do this, the couple would need a profitable business to support them financially. The Port Moresby real estate market provided exactly what they needed.

The business had helped to accomplish her dreams of providing quality education to her children and a dependable regular flow of income. However, after fifteen (15) years in operation, the implications of the Covid19 pandemic set her business on a downward spiral.

As Cecilia contemplated her next move in 2021, a friend from the Bank of PNG suggested she enquire with CEFI for business advice.

Around that time, CEFI was about to implement “The Training and Mentoring Program for Women-Led Businesses.” An initiative by the Asian Development Bank (ADB) with funding from the Women Entrepreneurs Finance Initiative (We-Fi), the program provided virtual training on financial literacy, business planning and debt management, and e-commerce to women entrepreneurs.

An important aim of the initiative was to help women-owned businesses recover from the effects of the Covid19 pandemic.

Cecilia was ecstatic to learn about the training and quickly expressed her interest to attend the program.

Within six months of completing her training, Cecilia breathed life back into her business by applying her newfound business skills. By the end of December 2021, her e-commerce skills had brought in tenants for her apartments.

“Using the knowledge gained from the training, I was able to advertise my business online and now have five new tenants renting my apartments” Cecilia said.

Her confidence has grown as a businesswoman.

The training has also enabled her to connect with other women SME owners. The sharing of ideas and approaches to managing various challenges from others has greatly helped Cecilia with her business.

CEFI continued to track her progress. In early 2022, Cecilia was one of five (5) women entrepreneurs that benefited from debt counseling from Mi Bank initiated by CEFI.

This determined businesswoman is also the President of the Lenoke Women’s Association (LWA) of South Bougainville where she is from.

As her understanding of finance and business management increased, she began to see the importance of financial literacy and desired it for her people.

In collaboration with Mi Bank, Cecilia organised for agents to visit her village in May 2022 enabling 73 people in Lenoke to open bank accounts. Those who had mobile phones also activated mobile banking services after opening an account. This was the first time for people in her village to have access to such bank services this easily.

LWA posted on its Facebook Page in May 2022.

“Banking the unbanked…. 95% of the people in Lenoke have never been to a bank. The sheer thought of standing in long queues for hours, to be sent home every day for a week until full requirements are met is a hindrance. Cash is safely tucked into a secret space of their thatched roof until a fire guts the bush material hut. Sending their money straight into the bank is revolutionary”.

LWA is now Mi Bank’s agent serving the South Bougainville area to open more personal savings accounts.

Apart from growing her business, Cecilia now wants to partner with CEFI to expand financial literacy in her Lenoke constituency. She wants her people to receive virtually retail financial literacy training as she did.

Embracing innovation is having a ripple effect on finance inclusion expansion.

Impact Stories

Impact Story 1 – Belinda Bakani

Belinda Bakani, hailing from Milne Bay and Central provinces, operates Classic Auto Services Ltd. alongside her partner from their residence in Korobosea, Port Moresby.

In 2021, after working at PNG Ports Corporation for 10 years, Belinda developed a keen interest in the automotive industry, although it wasn’t part of her initial plan. Initially resigning to pursue a career change, she decided to work with her partner while awaiting responses to job applications. Belinda took on a management role in the business her partner had established two years earlier.

Her responsibilities within the business primarily revolve around administration, finance, customer service, and marketing, while her partner handles the technical aspects with the assistance of other employees.

Belinda first learned about the online trainings offered by CEFI through her sister-in-law, Susan Bakani, who had also benefited from them. Upon discovering that Belinda had left her job to run the business with her partner, Susan advised her to get in touch with CEFI. Susan informed Belinda about the various training programs provided by CEFI to support women in the SME sector, enabling them to enhance and expand their businesses. Recognizing her relative newness to the business sector, Belinda found the motivation to register for and attend CEFI’s online training sessions in 2021.

Before participating in CEFI’s online trainings, Belinda had previously received training focused solely on Customer Care Services during her educational pursuits.

In July 2021, Belinda was among the 45 women in SMEs who attended the LedgerPal Training. The online training comprised three modules: Digital Financial Literacy, Business Planning & Debt Management, and E-Commerce. After completing the training, Belinda observed significant improvements in various areas:

  • Saving and reducing expenses by making informed spending decisions.
  • Enhancing budgeting skills through improved calculations and financial management.
  • Better business and financial management, expanding her knowledge in this domain.
  • Advancing marketing skills.
  • Learning from shared experiences with other WSMEs, exchanging challenges and ideas and establishing a network with like-minded individuals.

Belinda expresses gratitude for the opportunity to learn more about e-commerce. The training greatly aided her marketing and branding efforts for Classic Auto Services Ltd. She particularly utilized the Canva App, which was introduced during the training, to create a flyer to advertise for auto mechanics. This led to the successful recruitment of two young employees. At the end of 2021, Belinda utilized the same application to create a flyer offering a 10% discount on services, resulting in over 20 clients bringing their vehicles to her for servicing. The e-commerce training played a crucial role in her marketing activities as a beginner.

Belinda encourages young WSMEs, as well as existing ones, to attend the training programs offered by CEFI.

Building on her existing Certificate in General Business Administration, she took on secretarial duties for the business. Over time, she recognized the significant role she played in supporting Classic Auto Services Ltd and decided to focus her efforts accordingly. The online training programs conducted by CEFI provided valuable opportunities for Belinda to acquire skills that she could directly apply in the business.

At present, the business is thriving, thanks to Belinda’s enhanced marketing skills, which have expanded Classic Auto Services Ltd’s marketing reach. She now sends out at least 20 quotations and invoices to clients on a weekly basis. The e-commerce training has played a pivotal role in elevating their business’s visibility and public presence.


The National Q&A CEFI Director

  1. Tell us a bit about Centre for Excellence and Financial Inclusion.

CEFI was launched in April 2013, registered as an Association incorporated under PNG law and officially launched on 24th April, 2013 by the Hon Peter O’Neill. Members of the association include the Bank of PNG and Department of Planning and Monitoring. The board members consist of the Department of Treasury and the Department of Community Development, representatives from Commercial Banks, Micro Banks, Savings and Loan Societies and the Institute of Banking and Business Management (IBBM). CEFI was endorsed by PNG’s National Executive Council as the industry apex organisation mandated to coordinate, advocate and monitor all financial inclusion activities in PNG. In this capacity, CEFI has drafted and implemented two national financial inclusion strategies(NFIS 2014-2015 and NFIS 201602020) and is currently drafting the 3rd  National Financial Inclusion Strategy 2022-2016. It envisages creation of a robust financial sector which will reach people across the country and ensure all Papua New Guineans are financially competent and have access to a wide range of financial services that address their needs and are provided in a responsible and sustainable manner. CEFI’s mission is ‘Creating Financial Freedom’ that is to promote excellence in financial services, innovate delivery channels and facilitate financial education.

  1. What is financial inclusion?

Financial inclusion refers to individuals and businesses having access to and effectively use affordable financial products and services that meet their needs – payments, savings, credit and insurance – which are delivered in a responsible and sustainable way.

CEFI recognises that expanding financial services can encourage the participation of more Papua New Guineans, especially those in rural areas and urban settlements, in income generating activities in both the formal and informal sectors of the economy, and become part of the formal monetised economy thereby contributing meaningfully to the growth of the economy.

  1. Why is financial inclusion important?

Financial inclusion is important in the Papua New Guinea (PNG) context as 75% of the adult population do not have access to formal financial services. Difficult geographies, lack of physical and social infrastructure, limited technological skills and know-how has created difficult challenges in the supply and access of financial services. As a result a large portion the low-income population, in particular rural people and mostly women are financially ‘excluded’, meaning they lack access to basic financial services.

Consistent with the PNG Government’s Vision 2050 for Wealth Creation, financial inclusion aims to ensure  all people regardless of status, age and gender have access to a  wide range of quality financial services, provided to them at affordable prices, in a convenient manner, and on a sustainable basis.

  1. What are the successes of CEFI from implementing the first financial inclusion strategies?

Since the launch and implementation of the two National Financial Inclusion Strategies, unprecedented progress in financial inclusion has been achieved. As at March 2022 an aggregate of 3.6 million deposit accounts were held at regulated financial institutions with 1.2 million accounts belonging to women representing 33%. This is an increase of 2.5 million new accounts from 1.1 million accounts by December 2013. Financial access points in the country have grown by 56% in the last three years.

Papua New Guineans can now access the formal financial sector over 13,000 physical access points, as well as often via their mobile phones. In addition, Microinsurance has also been introduced in the country to reach remote communities.

Achievement and milestones achieved in the 1st National Financial Inclusion Strategy (2013-2015):

  • 1,187,024 new bank accounts opened – 462,939 ; 35% were women
  • 124,375 people reached with financial education ; 47% were women
  • 67 new branches, 73 ATMs, 4959 EFTPOS and 233 new agents added onto the financial service network on total 12,599 service outlets
  • 696,792 policy holders have taken out micro-insurance products
  • 315,993 people now linked their deposits account with Mobile Phone banking.
  1. Equal access of financial services for women is one of the organization’s core objectives.  Do you have specific targets you wish to achieve in regard to that objective?

Despite the achievements ,a majority of the population especially the vulnerable that includes women continues to lack access to formal financial services. It is more prevalent in rural communities, among women and microenterprises, especially those within the informal economy and in agriculture. Therefore, financial exclusion remains a fundamental challenge.

Nearly one of every three women in the world — or 1.1 billion — is excluded from the formal financial system. Globally, women are 7 percent less likely than men to have basic transactional accounts, and this disparity rises among the poor.

Women appear to have significantly lower levels of financial inclusion, even where financial services are available in urban communities. The scale of women’s financial exclusion in PNG makes it the need to focus on women. But this is not an easy task. Expanding access to finance for women brings some unique challenges. Socio-cultural factors, limited financial and/or functional literacy, lower levels of formal education and limited familiarity with formal financial institutions may be factors why women are likely to have lower levels of financial inclusion and engagement in household financial decision making. Further research is required to develop an understanding of the causal factors which can then provide a basis for gender specific programs and products.

The 2nd National Financial Inclusion Strategy 2016-2020 aimed to expand access to financial services to a further 2 million of PNG’s population of which 50% are women and also work with financial service providers in the country to provide products tailored to the needs of clients as it is clear that in particular, women and rural communities and MSMEs -including agricultural- suffer from the lack of products tailored to their needs, including access to credit.

Earlier this year, a Gender Equity and Social Inclusion (GESI) Policy for Microfinance Institutions was launched the Asian Development Bank (ADB), the Governments of Australia PNG and CEFI. The GESI policy was developed to help build and champion gender equity and social inclusion values and principles for MFIs.

CEFI believes that providing low-income women  with effective and affordable financial tools to save and borrow money, make and receive payments, and manage risk is critical to both women’s empowerment and poverty reduction. However, the path to greater women’s financial inclusion is dependent upon the creation of a more gender inclusive financial system that addresses the specific demand- and supply-side barriers faced by women, supported by an inclusive regulatory environment.

6. What are the significant challenges in providing financial literacy services especially to rural areas?

At the outset, financial literacy is a means to financial inclusion, that is, financial literacy could play an important role in enabling the most vulnerable segments of the population to use appropriate financial services. The main challenges or concern in delivering financial literacy in PNG rural areas is the high level illiteracy and demographically issolated communication limited or no government support . I

CEFI is in the process of reviewing its financial literacy courses and curricula so it’s tailored to the different segments of the community to improve their financial skills and knowledge. Such programmes should promote their awareness of available financial products and services and enable them to make appropriate choices of these services.

7. Recently a senior economist from Westpac Bank highlighted that the access to affordable financial credit was impeding the growth of businesses in PNG. Similar sentiments were shared by Commerce, Trade & Industry minister, Wera Mori at the inaugural SME Expo. Mori said lack of financial capital has slowed the growth of SMEs in PNG.  What is CEFI’s position in this regard?

CEFI agrees with those viewpoints. In fact, the 2nd Financial Inclusion Strategy (NFIS) seeks to align with and complement the initiatives implemented under the SME Policy 2016 and has SME finance as a key priority area under the new strategy. Small and Medium Enterprises (SMEs) play a major role in most economies, particularly in developing countries. They often employ a larger proportion of the population than larger enterprises and are therefore vital for inclusive economic growth. In PNG, SMEs already make a major contribution to national output, accounting for 200,000 jobs and an estimated 10% of GDP (though these figures are likely much higher if the informal sector is taken into account). Longer term, the government aims to increase the sector’s share of GDP to 50%. At present, SMEs face obstacles to financing and are often perceived as high-risk by commercial lenders. According to local media reports, 94.4% of SMEs in PNG have never received a loan and just 2.5% had benefitted from direct government assistance.

Due to the importance of SMEs for inclusive growth in PNG, CEFI and stakeholders decided to include this new Priority area: SME Finance: that is, focused on enhancing access to and usage of finance by SMEs. Activities include: Enhance knowledge and data on financial inclusion among SMEs; Review regulatory and supervisory frameworks to ensure they are fully enabling for SME Finance ; Promote innovation and competition in SME Finance; Facilitate dialogue on existing public sector interventions and support schemes and Strengthen capacity of SMEs and financial institutions.

8.We understand that CEFI has since launched two Financial Inclusion Strategies (NFIS) 2014-2015 and NFIS  2016-2020. What are some lessons from these two strategies?

As is the case in most countries in the world, the financial sector landscape is changing  the fact remains that we have made significant progress to date and also learnt some lessons. Important lessons learnt are:

  1. Networking and collaboration amongst all stakeholders is important.
  2. Improve Financial Literacy / Education and Financial Competency Levels for Papua New Guineans.
  3. Provincial and Local Level Government involvement.
  4. The need to set Financial Inclusion targets for financial service providers.
  5. Budgeting limitations and constraints.  

9.What is CEFI looking to achieve with the second strategy?

The public-sector goal is for financial inclusion to enable individuals and businesses to achieve their economic potential, i.e. to support economic development, increase incomes and improve the standard of living (impact). For the private sector, the goal is to acquire new customers, access new market segments and ultimately increase profits. The 2nd strategy will look at improving the 4 key pillars detailed:

Enabling environment: that is, the policy, legal and regulatory framework.  Important advancement to translate policy goals into a fully enabling environment for innovative financial inclusion. There is a need to finalize long-term regulatory framework for digital financial services; Need for demand-driven roll-out of National Payment Switch; Need to strengthen financial consumer protection as industry matures; Need to introduce a comprehensive regulatory framework for micro-insurance and the need for development partner support to catalyze further innovation and address capacity building needs.

Physical access points: Lack of financial access points, in particular in rural areas, continues to constitute a key barrier to financial inclusion in PNG. There is: 1) Need to increase physical access points in rural areas and 2)Need to exploit the potential of digital financial services to expand the reach of the formal financial sector

Quality: Need to further enhance product tailoring, in particular for excluded individuals and Businesses; Need to reduce reliance on cash; Need to further promote competition in order to reduce prices

Usage: Access and quality are both preconditions for effective and large scale usage of financial services. Financial literacy, competency and consumer awareness must be strengthened to drive usage


Sim Registration optional

The National Information & Communications Technology Authority (NICTA) of Papua New Guinea just recently extended the deadline of Mandatory SIM Card registration with the deactivation commencing on 28 January, 2018. Whilst there has been mad rush from the public to get SIMs registered, most may not realize that the mandatory process was in effect as of July 23, 2016.

As per SIM Card Registration Regulation 2016 (Statutory Instrument No.7 of 2016) as published in National Gazette No. G228 dated April 22, 2016; the objective of the regulation is to provide a regulatory framework for the registration of all SIM card users and for the control, administration and management of the Subscriber Information Database. The regulation applies to all licenses and all persons who use a SIM card in PNG but shall not extend to users of SIM cards issues by foreign licenses.

First of all, NICTA must be commended for taking this step as PNG joins major countries around the world with this mandatory policy. However, like all policies there are always some downsides to it.  Given the significant costs involved in implementing the registration process, maximising the benefits that can be derived from the exercise is very important.

Prepaid SIM card registration is currently mandated in around 90 countries and requires consumers to provide proof of identification in order to activate and use a mobile SIM card. A number of governments adopt this policy as part of efforts to help mitigate security concerns and to address criminal and anti-social behaviour. To date, there has been no empirical evidence that mandatory SIM registration directly leads to a reduction in crime. However, where the exercise is implemented effectively by taking into account local market circumstances, for example the ability of mobile operators to verify customers’ identity documents, SIM registration can enable many consumers to access value added mobile and digital services that would otherwise be unavailable to them as unregistered users. However, if the registration requirements are disproportionate to the specific market, the mandatory policy may unintentionally exclude vulnerable and socially disadvantaged consumers.

PNG is usually depicted as a land with high mountains fast flowing rivers and scattered islands making government services delivery in most part of the country a main challenge. Imagine the daunting task of registering a segment of the more than 8 million Papua New Guineans who live in one of the most diverse countries in the world with 848 different languages and physical terrains that has posed enormous difficulties in building transportation infrastructure.

Following SIM registration requirements in Zimbabwe, the two leading operators lost two million subscribers. In South Africa, MTN lost nearly a million subscriptions and growth for the industry slowed considerably afterward. In Kenya, more than 1.2 million SIM cards were shut off because they were not registered by the deadline. While some of these were unused accounts, many more were people who could not – often through no fault of their own – register their SIM cards.


‘Proof of ID’ requirements

There are various challenges but proof of ID requirements is anticipated as a major one for PNG. Like most countries, ‘Proof of ID’ requirements and this varies significantly across countries. The types of customer identity documents that mobile operators are asked to check as part of mandatory SIM registration processes vary – from government-issued identity cards and passports, to letters from the ‘village chief’ certifying the identity of the person being registered. However, in a number of countries, consumers who lack any official proof of ID risk being disconnected from mobile communications altogether. Globally, current estimates suggest that there are 1.5 billion people around the world who do not have any form of identity and would therefore be unable to register a mobile SIM in their own name, where SIM registration is mandated. Consequently (and ironically), the same policy that aims to reduce crime may be taking away those consumers’ means to report a crime or call emergency services.

More fundamentally, are those that lack formal identity documents, either because they never received them or have lost them over the years.


However, herein lies an opportunity. With the increasing importance of citizens having a secure digital identity and where there are issues with the availability of official identity documents, there may be a role for operators to support the government in the creation of a unique identity that can be authenticated and used for a variety of mobile and non-mobile services. This will, in part, help individuals who lack formal identity documents to access communication services but also potentially e-Government and other value added services that could deliver incremental value – not just to people’s lives but also to economic growth, through the uptake of new services via the mobile platform and the creation of jobs, etc.

Clearly, while mobile operators should not replace the role of the state as the provider of a legal identity, they are uniquely placed to help underserved members of society benefit from services that would otherwise be unavailable to them as unregistered users.

Increasing the opportunity to use mobile registration data for value-added services also increases the incentive to clean and maintain accurate data. This benefits consumers, governments and operators, to the extent that the registration requirements are proportional, reasonable from a cost perspective and any risks of social exclusion or to consumers’ privacy are mitigated.


In an ideal world the only SIMs that would be deactivated and barred from accessing mobile networks would be those that customers deliberately had deactivated, perhaps because they decided to keep a different SIM. In reality, this is rarely the case with large numbers of customers’ SIMs deactivated, only to reactivate the service after they have been excluded. Whilst the security priority may be to exclude unregistered SIMs, there is a need to balance this priority against the financial and social impact of excluding large numbers of people.

Setting reasonable timescales for registration and potentially limiting services for customers that haven’t registered are both approaches that can mitigate the risk of deactivation. To encourage registration a number of markets block some aspect of the service for a period before deactivating it completely. Nigeria, for example, blocked outgoing calls for three months prior to deactivation.

The people most at risk of deactivation are also the most vulnerable and socially disadvantaged citizens, especially those in rural areas. These citizens are often the same citizens that lack official ID papers and have the least access to locations that allow them to register. If implementation timescales are set too aggressively it is this community most likely to suffer.

Deactivation may also affect users who have mobile money wallets as deactivation to their accounts will mean deactivation to their mobile wallet accounts.

Whilst financial considerations rarely have a bearing on decisions related to mandatory SIM registration there is potentially significant impact on operator revenues and on tax revenues from deactivating large numbers of people who have failed to register. There is also significant evidence that the economic and social costs of exclusion are high. There is an impact on GDP, an impact on investment and all of the negative effects of digital exclusion for citizens. The registration process should look to encourage active users to register and to use mobile services; they should not exclude citizens, especially those who fail to register unintentionally.

Social and Economic Impact

The potential positive contribution of mobile registration should be considered as well as any role it may play for addressing security concerns. When implemented effectively, and assuming the appropriate consumer safeguards are in place, mobile registration can facilitate financial access or financial inclusion, help National ID registration and enable access to government services. Whilst mobile services deliver social and economic benefits on their own, enabling other services delivers incremental value. In 2015 the indirect benefits of mobile on the wider economy through general economic development and productivity improvement was 2.7% GDP growth, which globally equated to $2.025 trillion. Whilst addressing security and crime is the main reason governments give for the introduction of mandatory SIM registration requirements, the opportunity to add social and economic value should not be ignored. For many customers this can add significant value and it can also help other government departments achieve their public policy objectives and goals. Given the significant costs involved in implementing the registration process, maximising the benefits that can be derived from the exercise is very important.

During this process, it is critical that stakeholders consider the following:

  • Set registration deadlines that are realistic and reflect local market circumstances
    • Ensure registration requirements are clear and unambiguous
    • Encourage the storage of electronic (rather than paper-based) records
    • Encourage the registered ID to be used for other value-added mobile and digital services
    • Contribute to consumer awareness campaigns and to mobile operators’ operational costs

In the coming months, we hope that the SIM registration policy requirements are proportional and realistic, enabling – rather than inhibiting – services that can improve Papua New Guinean people’s lives and build a more inclusive society.

Mereseini Tuivuniwai is the Manager – Communications & Stakeholder Mobilisation with the Centre for Excellence in Financial Inclusion (CEFI)


Latest Port Moresby Ban Doomed to Failure

The National Capital District Commission (NCDC) has introduced a ban targeting the sale of cooked foods in Port Moresby. This is not the first time the NCDC has implemented such a ban. In the last decade alone, it has implemented several separate bans targeting the trade of betelnut and the sale of cooked foods in the city.

The first ban on betelnut was introduced in 2013, but was lifted in 2017 after it was discovered that betelnut was being smuggled by sea, and NCD reservists were implicated in a shooting linked to the ban.

The second ban, on the sale of both betelnut and cooked foods in public places, was introduced in 2017, about two months after the NCDC Governor had removed the previous ban on betelnut. According to the NCD city manager at that time, the ban was introduced because of “an increase in littering, petty crimes and other issues of health and safety in the city”. This ban continued into 2018 during and after the APEC Summit. The full ban on betelnut was replaced by a partial ban, which allowed sales in markets but banned them in public places, shopping malls and commercial areas.

The third ban, in 2019, outlawed the sale of cooked foods. Like the previous bans, many vendors did not comply with this ban as this activity sustained their livelihoods.

The last ban that was introduced before this latest one was in 2020. Selling of cooked foods had been banned during the COVID-19 state of emergency by the National Pandemic Controller. After pandemic restrictions were relaxed, the NCDC reintroduced its ban on betelnut. Under this ban, offenders faced a fine of K10,000 or three years in jail. The enforcement of this ban, which is supposedly still in place, is questionable given that betelnut is sold almost everywhere and there are no reports of offenders being fined or thrown into jail.

In sum, the earlier bans all failed. They have either been withdrawn or they are still in place, but not being implemented. What are the reasons for this failure?

First, the bans drive these activities underground. With betelnut this creates an opportunity for smuggling to thrive. Bans on cooked foods are either ignored or drive this widespread activity underground and make it harder to regulate.

Second, these bans affect countless households – both producers and sellers. Perhaps some 70-80% of the adult population in the city either use or sell betelnut. Poorly paid workers gathered around a cooking stand sizzling with sausages, potatoes, bananas and kaukau is a common sight in Port Moresby. A ban on cooked foods would deprive these workers of economical meals. Now is not a good time to be introducing a ban on the sale of cooked foods, with the cost of living on the rise due to escalating inflation.

Third, enforcement is always controversial and results in widespread public outcry. At the height of one of the first betelnut bans there were reports of widespread harassment, violence, abuse and in some cases, deaths. The effectiveness of the deployment of NCD police and reservists to enforce these bans leaves a lot to be desired. Their approach is confrontational rather than respectful.

It is disappointing that the NCDC has not itself learnt these lessons. It is also bizarre that the NCDC Governor has already indicated that he will review this decision which has just been made. Wouldn’t it be better to review the past experience before repeating a strategy that has failed? And what does this say about the relationship between the Governor and NCDC management?

review conducted in 2017, but not yet released, found that a total ban was not the best way forward for all stakeholders, including chewers and vendors. Experience on the ground clearly shows that the earlier ban, instead of improving hygiene, made the problem worse. The betelnut ban made this industry even more lucrative. The winners are the law breakers.

The NCDC management used the Informal Sector Development & Control Act 2004 to justify the introduction of the ban. However, in no way does the law support the imposition of a ban on informal economic activities such as the sale of cooked foods. Furthermore, questions have been raised about the legality of these bans. In fact, the NCDC acknowledged during a stakeholder workshop it organised in 2018 on the betelnut ban, that there were loopholes within the betelnut ban law and therefore the law could not be enforced by the courts.

The betelnut growers of Mekeo-Kuni LLG in Central Province have also challenged one of the NCD betelnut bans in court. That case has not yet been decided, but in 2013 the Lae City Court overturned the decision of the Lae City Council to close down the informal market in Voco Point, a trading hub for market vendors of cigarettes, food, cold drinks, and small goods.

The alternatives to bans are awareness and regulation. The NCDC should deploy trained health inspectors on the streets of Port Moresby, to do routine inspections and promote awareness to ensure that the sale of cooked foods and trade of betelnut conform with health and safety rules and standards, as per the NCDC’s own regulations as well as other relevant laws such as the Informal Sector Development & Control Act 2004.

The NCDC also needs to engage in dialogue with the affected traders. This would be facilitated if vendors were organised into associations. The Gordon’s Market Vendors Association and Little Income Generating Women’s Association are good examples, but need more promotion. The NCDC has made inroads in this area through its work with UN Women under the Safe Cities Program. It should fully institutionalise this program so that it is sustained.

It is clear from Port Moresby’s experience that bans of the sort just introduced are no solution at all. The current ban will be no different. The NCDC needs to take a different approach – one that is centred around awareness, regulation, and the organisation of informal micro-entrepreneurs into vendor associations.

Busa Jeremiah Wenogo is the Manager – Special Projects with the Centre for Excellence in Financial Inclusion (CEFI).

Disclosure: This research was undertaken with support of the ANU-UPNG Partnership, an initiative of the PNG-Australia Partnership, funded by the Department of Foreign Affairs and Trade. The views expressed by the author are not shared by CEFI.


CEFI graduates trainees in financial literacy

CEFI for the first time issued student identification numbers to its graduating trainees for the purpose of accessing a financial literacy application that CEFI is developing and planning to launch soon.
Head Trainer Jill Pijui made the announcement during presentation of certificates for 19 participants in a week long EOI (Expression of Interest) Training of Trainers Training.
“We will be doing back tracking of all our trainees whether Retail Training or Training of Trainers for the mass issue of student ID numbers,” Ms. Pijui said.
Ms. Pijui explained that CEFI is in the process of developing a financial literacy application (FL App) where these FL App will act as a reminder tool for the 250,000 trainers trained by CEFI.
“The FL App will remind the trainees to do their savings plan, banking, basic household budget, tracking of income and expenses and cash flow training, all these topics were covered in their respective training,” Ms. Pijui added.
In order to access the FL App, Ms. Pijui explained that all trained trainers will have to have a student ID number in order to access the application.
The 19 participants from the EOI Training of Trainers trainees were also the first batch to receive their student ID at the end of their training.
The EOI Training of Trainers training saw 14 female participants among among 19 trainees to be certified as trainers to train financial literacy in their respective communities.
Both employed and SME training providers attended the training from Monday, May 08th to 11th, which comprised of two women from the Autonomous Region of Bougainville, a participant each from Wewak and Enga while the rest of the trainees were from Port Moresby.

CEFI conducts second WSME workshop

The second series of training for the Online Training for Women (WSME) commenced this week (Tuesday May 02nd to Thursday May 04th), for Ni-Vanuatu WSME from Vanuatu.
Vanwods Microfinance Institution is the implementing agency in Port Vila, Capital of Vanuatu.
The Vanuatu WSME trainee participants virtually attended training through zoom from the Reserve Bank of Vanuatu’s Conference Room.
The WSME’s received training in Digital Financial Literacy, e-Commrece, Business Planning and Debt Management.
PNG and Solomon Islands training is scheduled respectively for May 23 to May 25, 2023.
The training is an initiative funded by the Asian Development Bank (ADB) and facilitated by the #cefi Centre for Excellence in Financial Inclusion.

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