Special Projects Update.
There were a number of projects implemented by the Special Projects Team in the second half of 2018. In particular; the Namatanai mobile phone feasibility study; Provincial Government Financial Inclusion Engagement, Financial Sector Development Strategy, CEFI organisation structure development work and corporate plan development.
A summary of the projects are outlined below:
The feasibility study on mobile banking in Namatanai District of New Ireland Province was conducted to establish the current status of banking services in the District and to establish the viability of banking and mobile banking services in the Namatanai District through a Super-Agent Model with its own Agent Network.
The Namatanai Mobile Banking Project was an initiative of the Namatanai District Administration, the Member for Namatanai Open Electorate Honourable Walter Snaubelt, and MiBank. The Centre for Excellence in Financial Inclusion (CEFI) was engaged to conduct the feasibility study to provide an independent assessment on the viability of banking and mobile banking services in Namatanai before actual investment is undertaken into the proposed banking model.
The Member and the District Administration of Namatanai recognised the need and the importance of “Access to banking and finance” in alleviating poverty, generating income for the rural population, engaging the unemployed rural population in meaningful economic activities, and facilitating economic growth in Namatanai District and engaged CEFI to conduct the feasibility study in partnership with MiBank.
Namatanai District is one of two districts of New Ireland Province. The Namatanai District has six LLGS.The people of the four LLGs of Namatanai Rural LLG, Matalai LLG, Konoagil LLG and Tanir LLG frequent Namatanai for shopping and banking services. However, due to lower prices of goods and services in Namatanai town, people from the LLGs of Nimamar and Sentral Niu Ailan also travel to Namatanai to do their shopping for store goods. Prices of store goods in Namatanai are comparable to that of Port Moresby and much lower than prices of store goods in Lihir, Konos, and Kavieng.
The Namatanai town has a BSP Rural Bank and is not effective in servicing the banking needs of the people and the business houses in Namatanai. The Rural bank has restrictions and limitations on deposits and withdrawals and does not accept cheque deposits. Cash injections and extraction is not carried out.
The people of Namatanai travel long distances, pay high transport costs, and even risk their lives travelling by boat at sea to access banking services in Lihir and Kokopo.
Business activity in Namatanai is robust with high demand for services including banking services. Namatanai District is the host district for two world class active mines, the Lihir and Simberi Gold Mines and the Solwara 1 Mine that is in the pipeline. The district also has three logging operations and produces other commodities like Copra, Cocoa and Oil Palm. The local people also supply fresh vegetables and fish products to the mining and logging camps. There are a number of Chinese supermarkets in Namatanai also dealing with sizeable amounts of cash on a daily basis. Mobile network operations in Namatanai is available and reliable. Mobile phone network accessibility in most LLGs in Namatanai is also adequate with the exceptions of inner parts of Konoagil, Matalai, and Tanir LLGs.
MiBank is an established Micro Bank with banking and mobile banking services experience in many provinces and districts throughout PNG. MiBank has a Branch in Lihir and an Agent in Kavieng at the time of the feasibility study. In terms of operational capacity of MiBank for the Namatanai operations, it is feasible with the current setup and MiBank back office support.
CEFI feasibility assessment shows that the Mibank Super Agent Model is feasible with lower establishment and operational costs. The forecasted demand is high hence the project looks feasible in terms of financial feasibility and operational support from the District Development Authority.
The recommendation from the feasibility study was to proceed with the Super-agent and network of Agents model in the Namatanai District. It was also recommended that launching be immediate as the market was a lucrative one. It is pleasing to report that the MiBank Super Agent in Namatanai including a Fresh Produce Buying Point has been open in November and is now in operation. Refer to news articles by Kevin Nyango in www.techinpacific.com under MiBank to focus on Digital Offerings for a future growth in PNG and Fresh Produce Project enables digital payments for female farmers in Namatanai District.
In 2019 CEFI plans to conduct a baseline study in the Gulf Province to determine the demand side issues to address as priority areas for the province. This activity has been agreed to by the Office of the Gulf Governor Hon. Chris Haiveta.
CEFI will also conduct a Mobile Phone Banking and Agency Banking feasibility study that will include training and development needs analysis for the land owner groups that receive royalties from the gold mine on Simberi Island, New Ireland province. The study was initiated by the Resource Sector Working Group and is funded by the Mineral Resources Authority(MRA).
A similar study is planned for Esa ala District in Milne Bay Province for the first quarter of 2019. This study will be funded by the Esa ala District Development Authority with the support of the open Member Hon. Steven Davies.