International Consultant for the formulation of And Building Inclusive Financial Sector in Mozambique (BIFSMO), Maputo, Mozambique

UNCDF is the UN's capital investment agency for the world's 48 least developed countries. It creates new opportunities for poor people and their communities by increasing access to microfinance and investment capital. UNCDF focuses on Africa and the poorest countries of Asia, with a special commitment to countries emerging from conflict or crisis. It provides seed capital – grants and loans – and technical support to help microfinance institutions reach more poor households and small businesses, and local governments finance the capital investments – water systems, feeder roads, schools, irrigation schemes – that will improve poor peoples' lives. UNCDF programmes help to empower women, and are designed to catalyze larger capital flows from the private sector, national governments and development partners, for maximum impact toward the Millennium Development Goals.

In Mozambique, the microfinance sector has experienced significant growth over the last five years, but is still is highly concentrated. In 2009, nearly 90% of the credit portfolio was spread among the 4 largest MFIs: Banco ProCredit, Socremo, Tchuma, and Banco de Oportunidades. The trend was the same in 2010.

The evolution of the microfinance sector is also characterized by:

• A degradation of the quality of the loan portfolio (the PAR 30 days was 1.65% in 2005 and rose to 5.75% in 2009 on average for all MFIs according to AMOMIF);
• An increase in the average amount of credit granted. In 2005 the average credit was 8.105 Mt and it increased to 19.906 Mt at the end of 2009, an increase of almost 150%;
• Only 11.8% of the adult population has access to financial services;
• 77.8% of the population is excluded from any type of financial services, including informal services. This exclusion rate is the highest in southern Africa;
• Of the population with access to financial services, more than three quarters live in urban areas.

Therefore, one of the major government priorities is to deepen the access to finance, especially in rural area, for women and the youth. To do so, the government intends to undertake further initiatives of financial sector reforms to deepen and broaden access to finance for both individuals and firms at rural areas. From 2005, the Government of Mozambique has taken some measures and initiatives to promote access to finance, in particular for rural populations. The major programs are the following:

Financial Sector Technical Assistance Program (FSTAP),

FSTAP lead by the World Bank, with others donors contributions under the auspices of the Ministry of Finance;

Rural Finance Support Program (RFSP

), RFSP lead by the International Fund for Agricultural Development (IFAD) with others donor's contributions under the auspices of the Ministry of Planning and Development;

The Local Initiative Investment Budget (OIIL),

is a national fund operate by local government and setup in 2006 by the Government of Mozambique under auspices of Ministry of state and administration;

Building Inclusive Finance Sector in Mozambique (BIFSMO).

UNDP and UNCDF support aims at helping the Government of Mozambique to pursue its poverty reduction objectives through supporting the efforts to establish and/or maintain effective national institutions, both state and non-state, and supporting the implementation of the development plans and, if necessary, the devising of national strategies for capacity-development.

In response to poor access to finance, both UNDP and UNCDF implemented the “Building Inclusive Financial Sector in Mozambique Project” (BIFSMO), a joint program under the auspices first of the Ministry of Plan and Development and later by Ministry of State and Administration. The project was initially designed for 3 years (2007-2009), but was extended until 2011 as part of the UNDAF and Country Program extension.

Findings from several evaluations and analysis undertaken in the context of UNDAF, CPD and BIFSMO, provide credible evidence that UNDP and UNCDF have led to important advance on access to finance but pointed out the important missing gap and need to focus in a coordinate manner on the issues of financial access for women and youth in general but particularly in rural areas. Therefore the future BIFSMO program will help increase economic opportunities for micro, small and medium enterprises in rural and peri-urban areas through inclusive market strategies and availability of financial services through inclusive and innovative microfinance products and services.

In addition, UNCDF is in the process of developing a financial inclusion country diagnostic and strategy process that will catalyse domestic efforts to extend FI and will feed into and leverage existing international platforms and processes. Once finalized, the tool will be piloted in selected countries and Mozambique will be one of those countries.

Duties and Responsibilities

Functions / Key Results Expected

Objective of the assignment

UNCDF and UNDP have both a strong and productive historical partnership with the Government of Mozambique in the field of inclusive finance. The program to be formulated will contribute to the country agenda for financial inclusion through the testing of the new financial inclusion country diagnostic and process. The program will:

• support the designing and the implementation of a National Strategy for Financial Inclusion and Action Plan in order to assist Mozambican Government to have an appropriate Framework that could create an enabling environment for the sustainable and secure development of access to finance services for the poor, low income and micro and small entrepreneurs;
• strengthen the delivery of microfinance services at the micro level and both the supportive services and the environment at the meso and macro levels;
• identify and cost activities plans for which support to be provided by UNCDF and UNDP will add value to interventions of other technical and financial partners;
• strengthen coordination between technical and financial partners and their progressive alignment with the action plan that will accompany the national strategy;
• propose an effective implementation mechanism and entry point which will ensure maximum output from all partners;
• propose a series of actions to tackle the bottlenecks raised in the evaluation report of BIFSMO phase I.

The program must enable UNCDF and UNDP to strategically position BIFSMO in a relationship with other stakeholders which would ensure maximum output from synergistic relationships.

With reference to lessons learned from the current BIFSMO program as well as other joint UNDP/UNCDF programs, the mission will ensure a participatory approach in the process of formulating a program with regards to microfinance stakeholders in Mozambique and current and potential financial and technical partners. he mission will undertake the following indicative tasks:

• Identify areas of interest of development partners in relation to the output of CPD and suggested output of future program (BIFSMO evaluation's findings);
• Identify the comparative advantages of UNCDF and UNDP and propose synergistic relationships with other development partners such KFW, World Bank, etc. involved in financial inclusion;
• Synergize proposed outputs and activities with other UN activities, UNDP poverty unit others projects, as well as UNCDF's thematic initiatives (MicroLead, YouthStart, CleanStart, Microinsurance);
• Outline a 4 year project document incorporating the following:

i. Indicative Activities

ii. Output and outcome indicators

iii. Budget

iv. Monitoring and evaluation plan;

• Integrate in this program, issues specific to the provision of rural financial services particularly for women and youth;
• Define strategy for continuous resource mobilization;
• Identify program keys partners;
• Indicate the appropriate institutional arrangements which allow the coherence and synergy with other financial inclusion initiatives;
• Define various institutional arrangements necessary to strengthen coordination and harmonization between technical and financial partners in project implementation;
• Define modalities of program management, including the fund management modalities between partners;
• Define indicators and mechanisms for monitoring and evaluation in line with the UNDAF and the CPD.

The expected output of the mission is a detailed project document based on the support to the three levels of the inclusive sector (macro, meso and micro), on the basis of the comparative advantages of UNDP, UNCDF and any other additional partner. The project document will follow the standard guidelines of UNCDF and UNDG. More specifically, it will include:

1. Analysis of the financial inclusion environment in Mozambique:

• Policies, strategy programs and institutional frameworks and the synergies to be developed by the new program;
• Ongoing or planned programs in the same area and the way the new programme will be complementary and add value to the sector.

2. Objectives and strategy of the program:

• Specify the orientations, objectives and expected results of the program and describe the strategy to achieve them,
• Analyse the risks which could affect the program implementation and success and the way to reduce them but also the opportunities;
• Outline UNDP/UNCDF comparative advantage and identify the potential partners which could join the program.

3. Institutional arrangements:

• Describe the program implementation mechanism;
• Decisions process and project coordination;
• Modalities of fund management;
• Monitoring and evaluation of the program;
• Detailed and realistic workplan and budget;
• Results and resources framework.

The mission will start with a briefing session and review available documents, including: PARPA, UNDAF, CPD 2012-2015, UNCDF Corporate Management Plan CMP, BIFSA (Building Inclusive Financial Sector in Africa), BIFSMO , the evaluation report, FINSCOPE Study of the Microfinance Sector in Mozambique, the National Rural Finance Strategy for Mozambique, BIFSMO project document PRODOC, various annual, quarterly reports, etc. The mission will hold meetings and consultations with the DNPDR management and project team, UNCDF/UNDP team, the Central Bank of Mozambique, the National Microfinance Reference Committee, the National Microfinance Network, AMOMIF, a sample of microfinance institutions and banks, other stakeholders in the microfinance sector, bilateral and multilateral organizations, national and development partners.

Deliverables

By the end of his/her mission in Mozambique, the International consultant will present an aide-memoire to the key stakeholders. He/she will submit an interim report to UNDP and UNCDF who will have one week to make and forward comments to the consultant. The consultant will also have one week to submit the final report which will integrate any comments made by UNDP/UNCDF.

The mission's final report will be forwarded in an electronic MS Word file to UNCDF Regional Office for Southern and East Africa and to UNDP Mozambique Country Office.

The report will include a table of contents which includes a summary, a list of abbreviations and acronyms used. Sources of documents used must be clearly indicated.

Duration

The mission will start on August 15th 2011 and will last for four weeks

Home country preparation 3 days

Mission to Mozambique 15 days

Final report writing home country 6 days

Total 24 days

The consultant will spend a total of 15 days of field work in Mozambique at the end of which he will present the aide memoire of the mission to the stakeholders. The consultant will spend the remaining 6 days in his/her home country for the purpose of writing the draft and final reports to be sent to UNCDF Regional Office in Johannesburg.

Interested consultants are requested to provide a brief technical proposal outlining their understanding of the mission as well as the methodology. In addition, they should provide an estimate of their daily fees and indicate their availability over the period from August 15th to September 30th, 2011. This documentation should be uploaded online (where “Upload CV” is indicated).

Impact of Results

The new BIFSMO program will contribute to the attainment of the MDGs in line with the UN Development Assistance Framework (UNDAF) 2012-15.

Competencies

Technical/Functional:

Managerial:

Required Skills and Experience

Education:

• Masters degree or equivalent in Economics, Finance, Bank management

Experience:

• Must have at least ten years of practical international experience and up to date knowledge in the microfinance sector, preferably in Africa
• A minimum of five years of microfinance or bank management and/or consulting experience
• Must have program formulation experience in microfinance
• Must have extensive experience in successful donor funded microfinance interventions
• Comprehensive knowledge of CGAP benchmarks and industry best practices
• Proven record in strategic thinking and policy and evaluation work
• Relevant microfinance experience at the country/regional level
• Experience at the country wide sector level/understanding of building inclusive financial sectors
• Excellent report writing and communication skills in English, in addition Portuguese or Spanish knowledge is an asset
• Ability to work in team and in multicultural situations

Language Requirements:

• Excellent report writing and communication skills in English. Proficiency in Portuguese is an asset.

UNDP is committed to achieving workforce diversity in terms of gender, nationality and culture. Individuals from minority groups, indigenous groups and persons with disabilities are equally encouraged to apply. All applications will be treated with the strictest confidence.