Annual Report 2015: Tigo & World Food Programme
In November 2015 Tigo Money and the World Food Program (WFP) engaged in a project to distribute monetary aid to 447 beneficiaries living in Santiago de Puringla, La Paz, a four-hour drive from the Honduran capital Tegucigalpa.
The region’s main economic activity is coffee farming, an industry that had been heavily impacted by drought and “La Roya”, a fungal blight. Santiago de Puringla was one of just 26 municipalities supported by the WFP as a result.
This project is in its pilot stages and the first step is for WFP to issue Tigo Money with a database containing information from the beneficiaries, so they could be pre-registered on Tigo's mobile network and Tigo Money platform. Each is then assigned a SIMCard and a Tigo Money wallet.
Then, Tigo Money and WFP teams deliver the SIMcards to each of the beneficiaries, with induction training on how the system worked, the kind of benefits they would receive from WFP over a three month period, as well as recommendations on how best to use them within their communities.
PIN numbers are set up in order to protect the money.
Once Tigo has transferred the WFP's financial aid to each of the beneficiaries' Tigo Money Wallets, an SMS is sent out. From here they are able to drop by their nearest Tigo Point of Sale with a valid ID and their PIN number in order to cash out.
The main benefits of the programme are threefold:
• Higher transparency: All transactions could be carried out on an electronic platform, enabling traceability and facilitating audits, reducing risk.
• Greater geographical coverage: The current finance / banking network has 900 agencies nationwide, while Tigo
Money has 3,300 points of sale in 92 per cent of municipalities around the country. The closest bank branch to Santiago de Puringla is a four-hour, round-trip drive away.
• Lower overall transaction costs: Despite being slightly more expensive in fees than traditional banks.
In 2016, further disbursements will take place, with the U.S. pledging US$2.3million towards WFP initiatives in five Honduran departments that have been affected by the drought, to support more than ten thousand families.