i

SUMMARY REPORT ON THE 2016 PILOTNONCASH DISBURSEMENTS OF FOOD ASSISTANCE AND SOCIAL ASSISTANCE

ii

iii

SUMMARY REPORT ON THE 2016 PILOTNONCASH DISBURSEMENTS OF FOOD ASSISTANCE AND SOCIAL ASSISTANCE

iv

SUMMARY REPORT ON THE 2016 PILOT

NONCASH DISBURSEMENTS OF FOOD ASSISTANCE AND SOCIAL ASSISTANCE

ISBN: 978-602-275-191-5

First Print, April 2019

Copyright Protected by Law

© 2019. Tim Nasional Percepatan Penanggulangan Kemiskinan (The National Team for

the Acceleration of Poverty Reduction)

You are permitted to copy, distribute and send this work for non-commercial purposes.

To request a copy of this publication or further information about this publication, please

contact the Social Assistance Policy Working Group (Kelompok Kerja Kebijakan Bantuan Sosial),

TNP2K Secretariat.

THE NATIONAL TEAM FOR THE ACCELERATION OF POVERTY REDUCTION

Secretariat of the Vice President of the Republic of Indonesia

Jl. Kebon Sirih No. 14, Central Jakarta 10110

Telephone : (021) 3912812

Faximile : (021) 3912511

E-mail : pokjabansos@tnp2k.go.id

Website : www.tnp2k.go.id

v

TABLE OF CONTENTS

Abbreviations and Acronyms

PILOT DESIGN

PILOT PREPARATION

PILOT IMPLEMENTATION

I. PreparationoftheBeneficiaryDataandtheMerchants/BankAgents

PreparationofMerchants/Agents/Stalls/Shops

II. Socialisation,DeliveryofInvitationstoBeneficiaries,andEducation

III. Registration, Account Opening, and Activation

IV. DisbursementofBenefitsthroughBankAccounts

V. Use of Benefits: Exchanging Electronic Vouchers for Food Assistance

andElectronicMoneyWithdrawal

MONITORING AND EVALUATION RESULTS

RECOMMENDATIONS

a. PreparingtheBeneficiaryData

b. Socialisation,Education,andNotificationtoBeneficiaries

c. TransactionModes/Devices,Registration,andActivation

d. AvailabilityandDistributionofAgents/Stalls/Shops

e. ImprovingtheEffectivenessofImplementingtheNoncashMechanism

f. Exchanging Electronic Food Vouchers and Withdrawing Electronic

Money

g. ServicetoBeneficiaries

h. Involvement of the Local Government

i. ImprovingTransactionSystemandInfrastructureattheAgent/Merchant

Level

v-vi

5-9

9-12

12-30

30-42

43-47

12-15

15-17

17-20

20-26

26-27

27-30

43

43-44

44

44-45

45-46

46

46

46-47

47

vi

FIGURES

Figure 1

NoncashDisbursementSchemeforFoodandSocialAssistancePrograms

Figure 2

StagesofNoncashDisbursementsofSocialandFoodAssistances

TABLES

Table 1

PilotImplementingPartnersandNoncashTransactionDevices

Table 2

Location, Banking/Telco Partner, Number of Beneficiaries, Socialisation

Schedule

Table 3

StrengthsandLimitationsofPilotTransactionModes

4

5

7

14

36-42

vii

ABBREVIATIONS AND ACRONYMS

APBD Anggaran Pendapatan dan Belanja Daerah

(Regional Revenue and Expenditure Budget)

ATM AutomatedTellerMachine

Bappenas Badan Perencanaan Pembangunan Nasional

(NationalDevelopmentPlanningAgency)

BI Bank Indonesia

Burekol Pembukaan rekening secara kolektif

(bulk or collective account opening)

CD CompactDisc

CIF Customer Information File

DPM Daftar Penerima Manfaat(ListofBeneficiaries)

EDC ElectronicDataCapture

e-KTP electronicIDcard

E-Warong KUBE Electronic cooperative stall

G2P Government-to-Person

Kelurahan Equivalent to a village (in an urban setting)

KemenkoPMK Kementerian Koordinator Bidang Pembangunan Manusia dan

Kebudayaan(CoordinatingMinistryofHumanandCultural

Development)

Kemenkominfo Kementerian Komunikasi dan Informatika

(MinistryofCommunicationandInformatics)

Kemensos Kementerian Sosial (MinistryofSocialAffairs/MoSA)

KK Kartu Keluarga (Family Registration Card)

KSP Kantor Staf Presiden(PresidentialStaffOffice)

KTP Kartu Tanda Penduduk(ResidentIDCard)

KYC Know-Your-Customer

Laku Pandai Layanan Keuangan Tanpa Kantor dalam Rangka Keuangan Inklusif

(Branchless Banking Services through Agents, program of OJK)

Musdes/muskel Musyawarah desa/kelurahan(village/kelurahan meeting)

NFC Near-Field Communications

NIK Nomor Induk Kependudukan(Identity(ID)Number)

OJK Otoritas Jasa Keuangan (Financial Services Authority)

viii

OTP One-Time Password

Perum BULOG Perusahaan Umum BULOG (State-owned Company for Food

Logistics)

PIC Person-in-Charge

PIN PersonalIdentificationNumber

PIP Program Indonesia Pintar (Smart Indonesia Program)

PKH Program Keluarga Harapan(HopefulFamilyProgram)

QR Quick Response (Code)

Raskin Subsidi Beras bagi Masyarakat Berpendapatan Rendah

(Rice Subsidy Program for the Poor)

RT Rukun Tetangga (neighbourhood units)

RW Rukun Warga (community units)

SIAK Sistem Informasi Administrasi Kependudukan

(population administrative information system)

SIM SubscriberIdentificationModule

SKU Surat Keterangan Usaha (Business License)

Telco Telecommunication company

Tikor Raskin Pusat Tim Koordinasi Raskin Pusat (Central Raskin Coordination Team)

TKPKD Tim Koordinasi Penanggulangan Kemiskinan Daerah

(Regional Poverty Reduction Coordination Team)

TNP2K Tim Nasional Percepatan Penanggulangan Kemiskinan

(National Team for Accelerating Poverty Reduction)

1

SUMMARYREPORT

2

1. The Rice Subsidy Program for the Poor (Program Subsidi Beras bagi Masyarakat

Berpendapatan Rendah/Raskin) is a program that aims to help low-income

groups to maintain their welfare and fulfil food needs, particularly rice.

Consumption of rice is the largest proportion of expenditure for poor households at

nearly30percentandevenalittlefluctuationinthepriceofricewillleadtoafallin

their welfare level.

2. Evaluations by various institutions show that implementation of the Raskin

Program is still far from meeting expectations. The main challenge is the practice

of ‘sharing equally’ —where Raskin rice is also disbursed to household groups

outside those specified in the List of Beneficiaries (Daftar Penerima Manfaat/DPM).

As a result, households that are entitled to receive Raskin only get an average of

7 kg of rice out of the 15 kg they should be entitled to. Another challenge is that

the price exceeds the prescribed price of IDR 1,600 per kilogram. This is due to,

among other reasons, transportation and other costs that must be levied on the

Raskin household beneficiaries. Although the State-owned Company for Food

Logistics (Perum BULOG) is determined to improve the quality of rice, sometimes rice

that is unsuitable for consumption is still found. In addition, delays in distribution often

cause several months-worth of Raskin to be disbursed at once or lump distribution of

two to three months’ worth of distribution. Lump distribution often occurs in remote

areas as well as in regions that have not paid for Raskin rice from previous months.

3. President Joko Widodo has directed that the Raskin program should be reformed.

The president issued this directive at the Limited Cabinet Meeting on Poverty and

EconomicInequalityReductionProgramson16March2016.Thepresidentaskedthat

the Raskin distribution system be changed to a voucher mechanism through gradual

implementation, starting in early 2017. Use of vouchers is intended to enable the

monitoringofRaskindistributionsothatbeneficiariescanobtainthedesiredquality

andtypeofriceatshops/stalls.Asidefromrice,voucherscouldalsobecombinedto

obtain other needs such as eggs. At the limited meeting, the president also directed

that a pilot be conducted in 2016 in preparation for implementation in 2017.

4. At the Limited Cabinet Meeting on Inclusive Finance on 26 April 2016, President Joko

Widodo issued a directive that all social assistance and subsidies be distributed

as a noncash benefit. The noncash disbursement shall use the banking system to

3

facilitate control and monitoring. Use of the banking system is expected to encourage

productive behaviour, expand financial inclusion, and accustom people to saving

behaviours.Thepresidentalsodirectedthatthevariouscardsandaccountsfordifferent

social assistance programs be integrated into a single card and a single account.

5. A pilot was to be implemented according to the decision of the Limited Cabinet

Meeting on the Raskin Program on 19 July 2016 at which the president reaffirmed

that Raskin distribution was to be replaced by vouchers. The president directed that

implementationofsuchvouchershouldbefirstpilotedinseveralmunicipalitiesbefore

being implemented in several major municipalities in 2017. “The application of a food

assistance voucher should be tested first in several municipalities and done carefully …

and only then it will be implemented in 2017” and “preparations for delivering the voucher

should be sound, because if the targeted recipients of the voucher are accurate, this can

quickly reduce poverty.”

6. Noncash disbursement is the direct transfer of social assistance/subsidy benefits

from the government to the savings accounts of beneficiaries. Social assistance/

subsidy benefits can be in the form of cash as in the Hopeful Family Program

(Program Keluarga Harapan/PKH) and the Smart Indonesia Program (Program

Indonesia Pintar/PIP) or in the form of goods (Raskin). In using the benefits,

beneficiaries can withdraw cash, purchase goods electronically, or put the money

into savings. For Raskin in particular, an electronic voucher is used to purchase rice

ofadesiredqualityatshops/stallsoftherecipient’schoice.Theelectronicvoucher

is expected to provide many advantages at once. First, accurate targeting, amount,

scheduling, and quality are guaranteed. Second, it gives greater options and control

to the poor in choosing the quality of rice and shops/stalls they will use. Third, it

encourages small retail businesses, both those already connected and those not

connected with the banking system to participate in this program. For retailers,

market merchants, traditional markets, and micro economy actors, in particular, their

involvementintheprogramcanincreasetheirbusinesscapacity.Fourth,beneficiaries

do not have to spend all of their food assistance at a certain time, so it can be saved

for when it is next needed.

SUMMARY REPORT

4

Figure 1: Noncash Disbursement Scheme for Food and Social Assistance Programs

6. The main principles in the concept of noncash disbursements of social and food

assistance benefits are:

(1) The assistance/subsidy beneficiary is given/opens a bank savings account

(BasicSavingsAccount)toreceivesocialassistancebenefits;

(2) Benefitsoftheprogramswillbetransferredtothesavingsaccount;

(3) Assistance/subsidy benefit is used through cash withdrawals, electronic

purchasesofgoodsor,specificallyforRaskin,throughelectronicvouchers;

(4) Electronicvouchersareusedforpurchasingriceand/orotheritemsthatwillbe

determinedlaterandcannotbewithdrawnincash;

(5) Assistance/subsidybenefitsintheformofcash—suchasPKHorPIP—canbe

withdrawnincashorspentelectronically;

(6) Assistancebeneficiariescanmakethetransactionsateveryplace(merchants/

agents/stalls/shopsandothers)thatprovidesnoncashtransactions;and

(7) Thereshallbenodeductiononthevalueofbenefitstransferredtothesavings

account. Assistance/subsidy benefits that have not been used will remain in

the savings account and can be accumulated.

Transaction modes/devices for noncash disbursements may be based on: (i) debit

cards; (ii) cellular phones; and (iii) Quick Response (QR) codes through websites. Cellular

phone-basedtransactionmodes/devicescanbeintheformofsubscriberidentification

module(SIM)cardsorNear-FieldCommunications(NFC)technology.

Cashwithdrawal

Electronic-voucher transactions

Transfers to savings account

Other banking transactions

Cash withdrawals/transfers

Transactions at bank branch offices/ATMs

Interbank transfers

Information on payment accounts

• Card-based• SIM Card-based• NFC-based• Website-based

Sub Account/Sub Wallet

Tran

sact

ion

Mo

de

s

Transactions at Merchants

Transactions at Banks

Other assistance/

subsidy programs

5

PILOT DESIGN

8. Before the 2017 noncash food assistance program is implemented, a pilot shall

be conducted to provide input for improving the program mechanism at every

stage. Piloting is an important activity considering that the noncash disbursement

mechanism is an innovation that has never been implemented. Through this pilot,

eachstageofthefieldimplementationcanbeobserved,andnecessaryfollow-up

stepsareidentifiedtoimproveefficiencyandeffectiveness.

9. TNP2K conducted a limited pilot of the noncash food assistance from September

to October 2016 with the aim to test the design and mechanism for the consecutive

stages of noncash disbursements of food and social assistances as illustrated in

Figure 2 below:

Figure 2: Stages of Noncash Disbursements of Social and Food Assistances

• Utilization of electronic money

• Exchange of e-voucher with food assistance

Benefitdisbursement

to bank savings accounts

Registration of beneficiariesand

activation ofdevices through

bank agents.

or

• Beneficiarydata preparation

• Bank agent setup

Notificationtothe household

beneficiariesanddissemination

of program information

• Datacompletionaccording to Know-Your-Customer (KYC) principle

• Activation of Card,SIMCard,or NFC

1 2 3 4 5

BANK

Bank agents

SUMMARY REPORT

6

(1) Preparation of beneficiary data and of agents/merchants: compiling and

stipulating the list of households to be beneficiaries in the pilot as well as

mapping and recruitment of agents/merchants by the banks or

telecommunicationcompanies(telcos);

(2) Socialisation and education, including sending invitation letters to

beneficiaries: informing beneficiaries about their participation in the pilot and

proceduresforusingnoncashtransactiondevices,benefits,andotheraspectsof

the pilot.

(3) Registration and activation of beneficiary’s savings account: opening

asavingsaccountinthenameofamemberofeachhouseholdbeneficiaryand

the delivery of transaction devices.

(4) Disbursements of benefits to the bank savings accounts: the process of

transferringthebenefitamounttoeachbeneficiary’ssavingsaccount.

(5) Utilization of benefits: exchanging electronic vouchers with rice and other food

itemsaswellascashwithdrawalsatbank/telcoagents.

10. Other aspects reviewed in the implementation of this pilot include the following:

a. Coordinationandidentificationofcommitmentswiththelocalgovernments;

b. Adequacyofthenumberandsuitabilityofthetypesofmerchants/stalls/shops

orbank/telcoagents;

c. Recruitmentofmerchants/stalls/shopsasagentsofthebanking/telcopartners;

d. Sufficiencyofstockandvarietyoffooditemsavailableatthemerchants/agents/

stalls/shops;

e. Preferenceoftypesandamountoffooditemspurchasedbythecommunity;

f. Coverageandeaseofreportingsystemsprovidedbythebanks/telcos;and

g. Field challenges or complaints reported by the recipient local governments as

well as available solutions.

11. The pilot tests all the debit card-based and cellular phones-based modes of

transactions. Choosing the transaction device technologies and banking/telco

partners that will participate in the pilot requires consultations on the readiness of

eachbank/telcothathas(orwillhave)adevelopedtechnologyandonthenumberof

existingagentsofeachprospectivebank/telco.Ultimately,therewerefivebanking/

telco partners in the pilot (see Table 1).

7

Table 1: Pilot Implementing Partners and Noncash Transaction Devices

No Pilot Implementing Partners Noncash Transaction Devices

1. PT. Bank Rakyat Indonesia (Persero), Tbk. DebitCard

2. PT.BankMandiri(Persero),Tbk. SIMCard

3. PT. Bank Negara Indonesia (Persero), Tbk. DebitCard

4.PT.BankPembangunanDaerahJawaTengah

(BPDJateng)QR Code + Website

5. BTPN in cooperation with PT. Telkomsel SIMCard+NFC

12. The pilot on noncash benefit disbursement was carried out for two program types:

a. Food assistance benefits, using electronic vouchers for in-kind social assistance

programs such as Raskin to the value of IDR 110,000/month for two months,

which can only be used for purchasing three types of goods, namely rice, eggs,

ormilk,andcannotbecashedin.ThebenefitamountisanestimateofRaskin

subsidy value per household per month.

b. Cashassistancebenefits,usingelectronicmoneyforsocialassistanceprograms

such as PKH or PIP of IDR 110,000/month for two months, which can be

withdrawn in cash, spent, or saved.

Program benefit types will be channelled through a single beneficiary account and

the transaction mode will be a debit card or cellular phone.

13. Conditions for using the electronic voucher for food assistance during the pilot

are as follows:

a. It can only be used for purchasing certain types of food that have been

determinedforthepilotimplementation,suchasrice,eggs,andmilk;

b. Exchange of the electronic voucher and the purchase of food can only take

place at merchants/agents/stalls/shops with a specific signage and in

cooperationwiththepilotimplementingbanks/telcos;

c. The benefit value of the electronic voucher can only be used for purchasing

theprescribedfooditemsandcannotbewithdrawnincash;

SUMMARY REPORT

8

d. The amount and combination of the purchased food items are up to the

beneficiary;

e. If the price of the purchased food items exceeds the value of the electronic

voucher,thebeneficiarymaypayadditionallywithcash;

f. The electronic voucher value may be partially saved (not spent in entirety).

If the price of the purchased food items is less than the value of the electronic

voucher,theremainingamountcanbesaved;and

g. The electronic voucher value will not be lost (that is, forfeited) and can be

accrued for future use.

14. Terms of using the cash assistance/subsidy benefit during the pilot are as follows:

a. Thebenefitvaluecanbewithdrawnorsaved;

b. Uses of the benefit value are not regulated. It can be used freely (no item

restrictions)toreducetheburdenoffamilyexpenses;

c. Cash withdrawal is permitted at bank/telco agents (including merchants/

shops/stalls),bankoffices,oratAutomatedTellerMachines(ATM);and

d. Can be saved in the bank account and can be accrued for future use.

15. Locations of the limited pilot were based on consultations with the pilot

implementing banking/telco partners with the following criteria:

a. Representing the western region of Indonesia, Java, and the eastern region of

Indonesia as advised by relevant ministries/agencies during discussions on

pilotpreparation;

b. Prioritizingurbanandsemi-urbanareas;

c. Thenumberofbeneficiariesineachkelurahan/villageshouldbelessthan300

households;

d. Availabilityofmerchants/agents/stalls/shopscooperatingwitheachbanking/

telcopartners;

e. Someareasrepresentingthedevelopmentofe-WarongKUBE;and

f. Inlinewiththecapacity/capabilityofthebanking/telcopartners.

16. The final number of pilot locations includes 20 kelurahan/village, 11 subdistricts,

six municipalities and two districts (semi-urban areas), namelyMedanMunicipality,

East Jakarta Municipality, Central Jakarta Municipality, Bogor District (semi-urban

area),SurakartaMunicipality,MalangMunicipality,SidoarjoDistrict(semi-urbanarea),

9

andMakassarMunicipality.

17. Criteria/parameters for determining the merchants/agents/stalls/shops in the

pilot activity are as follows:

a. Theratioofmerchants/agents/stalls/shopstobeneficiariesinthepilotactivity

is1:100,anumberconsideredadequatetoservebeneficiarieswithoutcausing

longqueuesofbeneficiarieswhenmakingtransactions;

b. Merchants/agents/stalls/shops are located within the piloting kelurahan/

villagearea;and

c. More than one merchant/agent/stall/shop are available in each piloting

kelurahan/villageareatoavoidpricesettingabovefairprices,andmerchants/

agents/stalls/shops shall provide at least one of the three types of

commodities (rice, eggs, and milk) prescribed in the pilot.

PILOT PREPARATION

18. Implementation of this pilot involved several stakeholders and was facilitated

by the TNP2K Secretariat. Stakeholdersconsistedofrelevantministries/agencies,

local governments, and potential banking partners. Relevant ministries/agencies

were involved in discussions regarding preparation and implementation of the pilot

monitoring. Meanwhile, the local governments were involved as implementing

partners in the pilot locations in checking beneficiary data, facilitating between

beneficiaries and banking/telco partners, socialisation and education, registration,

benefit disbursements, and monitoring. Meetings and consultations with potential

banks and telecommunication companies as pilot partners were conducted in April-

May2016,aroundthreetofourmonthsbeforethebenefitsweredisbursed.

19. The TNP2K Secretariat formed a Pilot Team to support the preparation and

implementation of the pilot. The Pilot Team consisted of a Team Leader, the Local

Implementation Team, the Communication/Socialisation Team, the Monitoring and

EvaluationTeam,aDataAnalyst,aReportingandDocumentationOfficer,aComplaint

ManagementExpert,anExpertforGovernment-to-Person(G2P)andMobileMoney.

20. Coordination and consultation with prospective implementing partners was

SUMMARY REPORT

10

done by the Pilot Team at a very early stage. This included discussions and

finalizationofvariousaspectstoensurethereadinessofpilot implementation,such

as:readinessofanoncashfinancialservicesystemandinfrastructureatthebanking/

telcopartners;readinessandavailabilityoffunds,especiallyfundsforbeneficiaries;

readiness and availability of merchants/agents/stalls/shops in the field; plans and

materialsforsocialisationandeducationforbeneficiaries;andcertaintyofthebenefit

disbursement schedules.

21. Scoping into selected potential areas was conducted by the Pilot Team under

TNP2K Secretariat with the banking/telco partners during 15-20 June 2016

(Phase One) and 2-5 July 2016 (Phase Two, for additional areas) to obtain

baseline information on area conditions, support of the local governments, and

the availability of merchants/agents/stalls/shops that sell food items and

potential to become bank/telco agents. Scoping results from the pilot areas

indicated that all local governments in the selected regions were ready to support the

pilot and facilitate the preparation and socialisation at the subdistrict and kelurahan/

village levels. Local governments, particularly kelurahan/village,werealsowillingto

deliver notification letters to the beneficiaries as long as therewas an official order

from the central government. Local governments also gave suggestions regarding

socialisation materials and media.

22. Initial mapping results in April 2016 showed that most existing banks —both

public and private banks— had not developed noncash disbursement designs in

line with the president’s directives. The only bank that had developed a noncash

disbursement system was BTPN in collaboration with PT. Telkomsel, which applied

the NFC technology as a platform/technology for benefit disbursements. It was,

therefore, decided to hold meetings and consultations with banks as prospective

pilot partners.

23. The DPM for this pilot was prepared by the TNP2K Secretariat. If the required

informationwasinsufficientforopeningabankaccount,thelocalgovernmentswere

alsowillingtocompletetheDPMwiththeIDnumber(Nomor Induk Kependudukan/

NIK) data as a Know-Your-Customer (KYC) requirement for opening bank accounts.

ForbeneficiarieswhodonothaveNIKs,kelurahan/villageswerewillingtocompletea

statement letter of domicile and to follow up with the NIK procurement.

11

24. Regional scoping results indicated that prior to implementing the pilot, available

merchants/agents/stalls/shops of banking/telco partners were not evenly

distributed —necessitating the recruitment of new agents by the banking/

telco partners. Merchants/agents/stalls/shops also had not fully met the criteria/

parameters specified in the pilot, namely: (i) the business types of the merchants/

agents/stalls/shopsvaried,notspecificallysellingfooditems(especiallyrice,eggs,

and milk); and (ii) most merchants/agents/stalls/shops did not meet the capacity

of cash liquidity as required. Banking/telco partners implemented a mechanism

for maintaining the cash liquidity of the agents through having their sales staff/

coordinators make visits to all agents. The TNP2K Secretariat coordinated with

banking/telco partners in identifying prospective merchants/agents/stalls/shops

that were relatively well-dispersed, especially those at which people usually shop for

their basic needs.

25. Coordination with relevant ministries/agencies and regulators started in April

2016, about five months before implementation of benefit disbursements.

Therelevantministries/agencies included: (i) theCentralRaskinCoordinationTeam

(Tim Koordinasi/Tikor Raskin Pusat),particularlytheCoordinatingMinistryofHuman

and Cultural Development (Kementerian Koordinator Bidang Pembangunan Manusia

dan Kebudayaan/KemenkoPMK)astheTrusteeandExecutiveChair;theMinistryof

SocialAffairs(Kementerian Sosial/Kemensos)astheproxybudgetuserfortheRaskin

Program; and the National Development Planning Agency (Badan Perencanaan

Pembangunan Nasional/Bappenas) for planning and monitoring; (ii) the Presidential

Staff Office (Kantor Staf Presiden/KSP) to oversee the president’s directives; and

(iii) the Financial Services Authority (Otoritas Jasa Keuangan/OJK)andBankIndonesia

(BI)asthebankingandinclusivefinancialregulators.Thekeyagendainthiscoordination

activity is to convey and get directional inputs for the pilot plan, including on work

principles,work partners, pilot areas, amounts of benefits, disbursement frequency

and period, as well as types of products to be piloted.

26. Coordination with the local governments —which is key to pilot implementation—

was done continuously through meetings, discussions, and sharing progress

status with local government contacts, namely the District/Municipal Raskin

Coordinating Team (Tikor Raskin Kabupaten/Kota and the Regional Poverty

Reduction Coordination Team (Tim Koordinasi Penanggulangan Kemiskinan

SUMMARY REPORT

12

Daerah/TKPKD). Inputs and feedbacks were requested from the local governments

on the following matters:

a. MechanismforupdatingtheRaskinDPMthatservedasthebasisforstipulating

thepilotbeneficiaries;

b. Use of components existing in the community, such as coordination

meetings at the kelurahan/village level, meetings at mosques, as information

disseminationchannels;

c. Importance of introducing the activity as early as possible to the local

governments in order to be able to allocate funds for the pilot activity in the

Regional Revenue and Expenditure Budget (Anggaran Pendapatan dan Belanja

Daerah/APBD);and

d. Identification of the possibilities of public complaints emerging from the pilot.

Thelocalgovernmentswerealsoexpectedtoprovideorfacilitatethefindingof

solutionstoproblemsinthefield.

PILOT IMPLEMENTATION

I. Preparation of the Beneficiary Data and the Merchants/Bank Agents

27. Pilot beneficiaries are households whose names and addresses are listed in the

2016 Raskin DPM as updated and agreed upon by the piloting kelurahan/villages.

TheRaskinDPMwaschosenasthereferenceforstipulatingthepilotbeneficiaries

basedonthefollowingreasons:(i)theDPMallowedforimmediateuseinthepilotas

therewas no need to choose new targets; (ii) this could minimize the potential for

confusionandsocialconflictinthecommunity;and(iii)theDPMcouldhelpthePilot

Team obtain information on the perceptions of the beneficiaries and their

preferences between the noncash and regular Raskin mechanisms. The stipulation

of Raskin household beneficiaries as the pilot beneficiaries did not invalidate their

right to receive the regular Raskin rice allocations that they could still redeem

during monthly Raskin distributions for September 2016 and October 2016.

28. The number of beneficiaries for each pilot kelurahan/village is shown in Table 1.

Data in the DPM comprise: (i) name of the head of the household; (ii) name of

the spouse of the head of the household; (iii) names of household members; and

13

(iv) the domicile address.The DPMwas then handed directly by the PilotTeam to

the kelurahan/village-level Raskin officers for verification. The DPM required

recheckinggiventhechangesinDPMdueto:(i)migrationanddeceasedhousehold

beneficiaries; and (ii) the mechanism used in the Raskin Program for replacing the

targetedhouseholds,namelythroughthevillage/kelurahan meeting (musyawarah

desa/kelurahan or musdes/muskel). The updated list of beneficiaries is then

processed by the TNP2K Secretariat Team to smooth the progress of the pilot

implementation.The listwas then returned to the kelurahan/village to be agreed

upon as the list of pilot beneficiaries marked by the signing of a statement of

handover.

29. The agreed list is stored on a compact disc (CD) and forwarded by the TNP2K

Secretariat Team to each bank/telco as the piloting partners for the preparation

of a recipient database at the bank/telco. TheentirepreparationprocessforDPM

untilitisreadyforusetakesaroundonetotwomonths.Informationonbeneficiaries

of this integrated database is the basis for opening a beneficiary savings account

that is uploaded into the system and application of the banking/telco partner.

The preliminary upload is done to save time for registration and activation of

the savings account.

SUMMARY REPORT

14

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15

30. During beneficiary data verification, the average replacement of household

beneficiaries in the pilot area was around 7.4 percent. In connection to updating

data,thefollowingpointsinfluencethedataupdatingprocess,namely:

a. DataformatandthetimeofDPMsubmissionfromthekelurahan/villagevaried;

b. The local governments were not very responsive in updating DPM in their

regionsduetothelackoftechnicalcapabilitiesandlimitationinworkingdevices;

c. Additional efforts were needed in collecting data on name of the biological

motherofthebeneficiaryasrequiredforopeningasavingsaccount;and

d. TheexistingDPMhadnotbeenupdatedduetoanyaddresschangeordeathof

beneficiary.

PREPARATION OF MERCHANTS/AGENTS/STALLS/SHOPS

31. One of the pilot preparation activities was recruitment of merchants/agents/

stalls/shops as bank/telco agents because the number of merchants/agents/

stalls/shops have not met the required agent-to-beneficiary ratio. Banking/telco

partnershadtheirownmethods/strategiesinrecruitingmerchants/agents/stalls/

shopsforthepilot.Oneinitiativethathelpedthebanking/telcopartnersinrecruiting

merchants/agents/stalls/shops was through involving the kelurahan/village

officials, community units (Rukun Warga/RW) and neighbourhood units (Rukun

Tetangga/RT)inidentifyingpotentialfoodstalls/shopstoparticipateinthepilot.This

initiative is quite effective considering that the locals have more knowledge about

the level of inventory in shops/stalls in their area, shops/stalls that are known or

trusted by the community, and dispersion of their locations.

32. Following the recruitment by the banking/telco partners, 62 merchants/

agents/stalls/shops were involved in the pilot in the eight pilot areas. Of this

number, the majority had sold food items before the pilot, while only five were

new to selling food items. During the pilot implementation, all agents sold food

items. During the pilot, the banking/telco partners recruited new merchants/

agents/stalls/shops in line with rules applicable to each banking/telco partner

and the process was relatively easy and fast. Requirements of the banking/telco

partners include how long the business has been established, minimum cash

liquidity.Onebankrequiredaminimumdepositof IDRthreemillionthatcouldnot

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SUMMARY REPORT

16

be liquidated if they remained serving as bank agents.

33. Challenges that emerged in this process included merchants/agents/stalls/

shops having difficulties in fulfilling bank/telco requirements and readiness of

the merchants/agents/stalls/shops to conduct noncash transactions. In spite

of the challenges, a number of food merchants/agents/stalls/shops were willing

to participate in the pilot from the beginning for the following reasons: (1) desire to

help the community; (2) potential additional customers; (3) potential additional

profits from assistance benefit uses; and (4) interest in becoming an agent that

would provide other services. The capability of the food agents/stalls varied,

depending on their cash liquidity and ability to provide food items —rice, eggs, and

milk.

34. Until the registration phase, there were still areas where the ratio of

agents to beneficiaries had not met the 1:100 ratio of the pilot design. Difficulty

of getting merchants/agents/stalls/shops in pilot kelurahan/village was due to

the unwillingness of some food shopkeepers or stall owners in the area to work with

the banking/telco partner. The food shopkeepers or stall owners that had been

invited to participate were worried about their inability to operate the transaction

equipment, provide cash funds, and their ability to serve a queue of beneficiaries.

Kelurahan/village officials and neighbourhood heads played a very helpful role in

addingagentsuntilreachingtheidealnumberofbank/telcoagentsalthoughsome

of them were located just outside the kelurahan/villagearea.

35. Three factors to be considered in ensuring effectiveness of the noncash food/

social assistance program in terms of the ability of merchants/agents/stalls/

shops are: (a)availabilityoffooditems;(b)variationsintypesandqualityofthefood

items;and(c)reasonablepricesofthefooditems(marketprices).

36. Ensuring adequacy of agents will require: (a) a self-registration mechanism for all

retail trade business actors to propose themselves as merchants/agents/stalls/

shops that serve noncash transactions; (b) a mechanism for the involvement and

active role of stakeholders at the kelurahan/village level in identifying potential

merchants/agents/stalls/potential shops; (c) ideal distance between households

andthetransactionlocationstodeterminethemerchant/agent/stall/shopserving

SUMMARY REPORT

17

noncash transactions; (d) merchants/agents/stalls/shops are within the same

kelurahan/village; (e) enhancing information networks and cooperation between

merchants/agents/stalls/shops with food suppliers/distributors; and (f) support

the cash liquidity of the merchants/agents/stalls/shops in giving services for

thewithdrawalofcashbenefits.

II. Socialisation, Delivery of Invitations To Beneficiaries, and Education

37. The socialisation and education activity for the stakeholders —particularly

beneficiaries and merchants/agents/stalls/shops— is very important to garner

support and ensure that those involved in the activity have good information and

understanding. In this pilot, mass communication channels, such as television

and radio, were not chosen as socialisation and education channels due to their

limited coverage.

38. Three main messages to be conveyed during socialisation were: information

about the program overall; disbursement mechanism during the pilot; and

the registration and transaction locations. The media chosen to be used and targets

of the three messages were: (1) a letter explaining brief information and

participation in the pilot —addressed to beneficiaries; (2) audio visuals containing

five-toseven-minutetutorialabouttheactivityoverall,includingthedisbursement

mechanismofeverybanking/telcopartnerinthepilot—addressedtoTikorRaskin,

localgovernmentsandagents/merchants;(3)aguidebook that contains complete

informationregardingtheprogramanddisbursementmechanismofeachbanking/

telco partner in the pilot —addressed to Tikor Raskin, local governments and

agents/merchants; (4) an information sheet containing explanations on

the mechanism of each banking/telco partner in the pilot —addressed to

beneficiaries; and (5) a list of merchants/agents/stalls/shops containing

informationonthenamesandlocationsofpartnermerchants/agents/stalls/shops

inthepilot—addressedtobeneficiaries.

SUMMARY REPORT

18

39. Besides socialisation material and facilities, the most important aspect of

the socialisation and education design was the socialisation media/channel

that would be used in the pilot. Among the considerations for using certain

channels in this pilot are that they can be applied in the initial implementation of

food assistance in 44 municipalities in 2017 and the possibility they can be

implemented at national scale after 2017.

40. Considering the main message to be delivered, three communication channels

were used in the pilot activity, namely: (1) the government, through a tiered

method, disseminated information regarding the overall program from the central

government to the local government, at the municipal/district level, subdistrict

level, and eventually the kelurahan/villageandRW/RTlevels;(2)thebanking/telco

partners in the pilot, as counterparts who understand the disbursement

mechanisms through the merchants/agents/stalls/shops, provided information

on the disbursement mechanism; and (3) the RW/RT, as they are the most

accessible for beneficiaries, received basic information about the pilot activity and

benefitdisbursements.

19

SUMMARY REPORT

41. Socialisation and education to beneficiaries started with the delivery of

a notification letter. The notification letter basically informs the letter’s recipient

that their household has been selected to participate in the pilot activity and receive

noncashdisbursementsofsocialassistancebenefitsduringthepilotperiod.

42. Another important socialisation stage was the method for delivering

the notification to the beneficiaries. Two delivery methods were used by

the banking/telco partners during the pilot, namely by sending directly through

third parties to the address of the household and by sending the notification

through the kelurahan/village officials. Both ways involve coordination with

kelurahan/village officials. The readiness and willingness of RT/RW heads and

kelurahan/villageofficialstoactivelybecomeresourcepersonsforthebeneficiaries

regarding key information of the pilot was an important component in

the implementation. In this pilot, socialisation and education sessions for resource

persons at the kelurahan/village level were conducted through meetings with

theRT/RWheadsandkelurahan/villageofficials.

43. Education to increase the capacity and ability of merchants/agents/stalls/shops,

particularly new agents, to provide noncash transaction services was provided by

banking/telco partners. Two training methods were applied in the pilot activity,

namely: (1) class method; and/or (2) training at the business location of every

merchant/agent/stall/shop. The training and education of merchants/agents/

stalls/shops during the pilot was well conducted and transaction mechanisms

were well understood by training participants. There were some exceptions with

some personnel who had little experience in using technology.

44. Other important takeaways and lessons from the socialisation and education

aspect is that beneficiaries require persons or a source to obtain information and

further confirmation to address misunderstandings about the purpose, objective,

and scope of activities. In this pilot, RT/RW heads, cadres, agents functioned as

providersofinformationtobeneficiaries.Thecomprehensivenessanduniformityof

understanding from the implementers and those involved in the socialisation of

activities is very important to avoid confusion in the implementation of activities at

themerchant/agent/stall/shopandbeneficiarylevels.Informationwhenconveyed

directly was easier for the communities to understand compared to using written

20

media (such as letters). Another lesson from this pilot was that the availability of

socialisation facilities/instruments prior to field implementation needed to be

ensured to smoothen the socialisation process.

III. Registration, Account Opening, and Activation

45. In the pilot activity, there are three scenarios for the account holder name:

(i) the spouse of the head of the household (usually a female); (ii) the head of

the household (usually a male); or (iii) the individual within the household who

attends the registration event. Inprinciple,thesavingsaccountopening/activation

process for any beneficiary complies with the applicable banking rules and

procedures. The common procedure was that the prospective bank customer

would register by bringing a valid identification document, such as an ID Card

(Kartu Tanda Penduduk/KTP),andfilloutaregistrationform,includingtheKYCdata

and signature specimen.

46. According to the pilot design, the savings account of every beneficiary comprises

two subaccounts (wallets), each for the benefit of a program, namely:

(i) the subaccount for food assistance benefit in the form of electronic vouchers

used only for purchasing food items; and (ii) subaccount for cash benefits. Both

arelinkedtotheaccountofthebeneficiary.ForBankMandiri’ssystem,exceptionally,

thebeneficiaryaccountonlyreceivedfoodassistancebenefitsfromtheelectronic

voucher. In this pilot, the savings account and the wallets were activated at the same

timeoftheregistrationandaccountopeningprocessforthebeneficiary.

47. In general, there were two ways to open an account: (1) savings account opening

in the bulk or collective account opening (pembukaan rekening secara kolektif/

burekol) system; and (2) opening through online registration. The availability of

beneficiary data allowed the banking partners to expedite the account opening

processforbeneficiariesduringtheregistration.

48. In the collective account opening, prospective beneficiary data was made

available beforehand, including their full names and ID numbers (NIK). The banks

openedaccountsbasedonsuchbeneficiarydataandthenheldregistrationevents

21

to complete other necessary data, such as the date of birth, mother’s maiden name,

andsignatureaccordingtotheIDcard(KTP)ofthebeneficiary.

49. In the online bank registration, the beneficiary data was uploaded by the banking

partner into its system. The registration process was done at the agent of the banking

partnerwhenthebeneficiarypresentedhis/hernotificationletterthathadaunique

number to the bank agent. The bank agent then inputted the unique number from

the letter. As the data was uploaded online, some of the fields in the online

registrationwouldalreadybefilled.Onlyseveralfieldswould,therefore,remainblank

andneedtobefilled(mother’smaidenname,theplaceanddateofbirth)orwould

require corrections, such as an incorrect address. After the registration process was

complete, back-end approval from the bank needed to be obtained for opening

the account.

50. The bulk account opening process through the collective account opening

(burekol) system for beneficiaries was done by BNI and BRI. The banks set one

beneficiary name as the account owner (referring to paragraph 45) without

theattendanceofthebeneficiary.Thebeneficiary’sdatawaspreparedaccordingto

the2016RaskinDPMthathadbeenupdatedbythelocalgovernment.Theaccount

opening process was done in line with BI regulations. The banks still required

the beneficiary to be present at the registration/activation event and bring

supporting documents. Besides BRI and BNI, Bank Jateng also performed collective

account opening. The difference is that, in the account activation process, Bank

Jatengdidnotrequirethebeneficiarytobepresent.

51. Account opening through an online registration procedure was used by BTPN-

Telkomsel, whereas registration of the beneficiary was done at any BTPN-

Telkomsel agent. The procedure was carried out as explained in paragraph 50.

52. Bank Mandiri combined two account opening procedures. The bank set three

members of every household beneficiary as prospective account holders.

At the time of registration, one of the household members present became

the definitive account holder after producing the required matching identity

documents.

22

53. The challenges in opening a collective account during the pilot included:

(1) ID number-related issues; (2) every beneficiary already having a savings

account or Customer Information File (CIF) at the banking partner; and

(3) the doubts of BNI and BRI in handing over printed savings books to

beneficiaries. The challenges relating with the ID number included when: (1)

abeneficiary’sIDnumber(NIK)datawasregisteredforadifferentpersonthatcould

be caused by duplicate ID numbers and synchronization issues between the

electronic ID card (e-KTP) system and the population administrative information

system (Sistem Informasi Administrasi Kependudukan/SIAK);or(2)abeneficiaryhad

neverhadanIDnumber(NIK).

54. There are several reasons why banking partners might have been reluctant

to hand over savings books and transaction devices to beneficiaries. First,

inconsistenciesinabeneficiary’s identityinformationasrecordedinthelistofpilot

beneficiarieswith the information in the beneficiary’s identity documents, such as:

name,IDnumber,andaddressdidnotmatch.Inthissituation,thebankingpartner

would ask for advice and approval of the Central Pilot Team. Second, household

members designated to be account holders (head of the household or the spouse)

had died or migrated. Based on applicable regulations, the bank must ask for

adeathcertificateorapowerofattorneyoftheaccountholder.Inaddition,incases

of death, the bank must close the account. Third, household members under

17yearsoldwhowereheirsbutdidnotyetholdanIDcard(KTP).Thebankwould

require an approval letter from a legal guardian. Fourth,thespouseshadseparated/

divorced. According to bank rules, the account shall remain in the name of

the account holder (either the husband or the wife) and this can lead to potential

conflictwithinthehouseholdandincompatibilitywithprogramcriteriaandpurposes.

Such cases need to be handled immediately to ensure the success of program

implementation in 2017.

55. Challenges faced by banking/telco partners in online registration included,

among others: (1) failure in the registration process for not having an ID Card or

havinglostit;(2)disruptionstotheserverreceivingtheregistrationprocess;(3)cellular

data service disruption during registration; (4) supporting documents were not

readableinthesystem(forexample:unclearKTPphoto);(5)signaturedidnotmatch

the one on the ID card during registration; and (6) inability or unpreparedness of

23

SUMMARY REPORT

agentsdirectlyaffectedthelengthofregistrationtime.

56. Three methods/locations for distributing and activating transaction devices

used in the pilot were as follow: (1) provision of a special temporary counter by

the banking partner at the kelurahan/village level for a duration agreed by

the banking partner with the kelurahan/village.The process required coordination

with kelurahan/village officials to determine the location, duration, and

announcement to the beneficiaries; (ii) meetings with community members was

usedforopeningaccountsanddistributingSIMcardsthatservedasthetransaction

device;and(3)throughtheagentsofthebanking/telcopartnerduringtheaccount

opening process. Registration is done online by providing, installing, and activating

theNFCstickeronthecellularphoneofthebeneficiary.Atthesametime,theNFC

device is fixed to the cellular phone of the beneficiary and activated for use in

transactions.

57. An advantage of the first distribution method is branch offices of the banking

partners were not burdened by a surge of visitors. Furthermore, it did not attract

crowds in the kelurahan/village that might otherwise have caused community

memberswhowerenotprogrambeneficiariesbecomeenviousofthosewhowere.

Thisfirstmethodalsohaschallenges,however,asaprospectivebeneficiarycould

havebeenremovedfromthelistofbeneficiariesiftheyhadnotbeenabletocome

tothetemporarycounterduringitsoperatingperiod(fivedaysonaverage).

58. The advantage of the second method is that the time allocation was more

efficient, particularly for bank officers. In the second method, however,

the greatest challenge is to identify the location and time for the meeting. Besides

that,notallbeneficiarieswereabletobepresentatthescheduledtimeforvarious

reasons,particularlyinregionswithlargenumbersofbeneficiaries.

59. The main advantage of the third method is that it allowed multi-location

registration and activation at the village/kelurahan level that let beneficiaries

to choose a registration location. This method was accommodating and made

itconvenientforbeneficiariestoaccesstheclosestregistrationlocation,therefore,

minimizingthepotentialforbeneficiariesnotshowingupforregistration.Inthisthird

method, however, the challenge is the readiness and resource capacity of the bank

24

and agents to do online registration in multiple locations.

60. For vulnerable groups such as the elderly and/or people with disabilities who

were unable to come for the registration/activation due to physical barriers,

it required proactive efforts of the banking/telco partners and the local

governments for ensuring the vulnerable group could still be registered and have

their account activated. Based on a survey of 451 beneficiaries, 32 percent were

elderly (above 60 years of age).

61. Each of the two transaction modes/devices —cellular phone-based and debit

card-based— have advantages and disadvantages. Advantages of the cellular

phone-based mode include: (1) it is cost effective for the bank and the merchant;

(2) besides the cellular phone itself, there is no need for additional equipment;

(3)therearelong-termadvantages,suchaswidespreadtechnologicalpenetration;

and (4) easy notification. Advantages of the debit card-based mode include:

(1)theabilitytotarget100percentofbeneficiaries;(2)manymerchantsareusedtoit;

and(3)theabilitytowithdrawcashfromanATM.

62. The main disadvantage of the debit card-based mode is the high cost for

printing cards and procuring electronic data capture (EDC) devices. Other

disadvantages include the necessity to have additional equipment (EDC devices)

25

SUMMARY REPORT

whereas notification of disbursement is difficult to broadcast.The disadvantage of

thecellularphone-basedmodeisthatonlyfewbeneficiarieshavecellularphones

anditsinconveniencesforelderlybeneficiaries.

63. Based on requirements that beneficiaries must meet during the activation

process of the transaction/technological devices, requirements for debit cards

and QR Code are considered the simplest. Beneficiaries only needed to bring

alongthesupportingdocuments,namelythenotificationletterforpilotbeneficiary

and identity documents (KTP and KK).

64. SIM card and NFC-based transaction devices required an active cellular phone

and SIM card as well as the notification letter for the pilot beneficiary and identity

documents for the registration/activation process. There were two main problems

with SIM card or NFC-based account activation, regarding: (i) beneficiaries who

did not have cellular phones at all; and (ii) beneficiaries who used products from

other telecommunication providers. The solution to this problem was to distribute

new SIM cards and/or agents lent a cellular phone to hold the SIM card during

the registration process for beneficiaries who did not own a cellular phone. After

thefirsttransactionwascompleted,theSIMcardandNFCstickerwouldbebrought

bythebeneficiaryforsubsequenttransactionpurposes.

65. On the transaction devices needed by the agents, the banking partners used two

main devices, namely: (1) EDC devices, for banking partners who used the debit

card and SIM card mechanism; and (2) cellular phones, for banking partners who

used SIM card + NFC-based and QR Code + website-based transaction devices.

The EDC deviceswere provided by banking partners (BNI, BRI, and Bank Mandiri)

and lent to the agents. For agents of Bank Jateng, the cellular phone was provided

by the agents, whereas for agents of BTPN-Telkomsel, the cellular phone was lent by

the banking partner to the agents. All cellular phones used were smartphones.

66. BNI used one type of EDC device with 3G technology, while BRI used two types of

EDC device, one for noncash transactions and the other for electronic vouchers

—both of which still used 2G technology. Connection disruptions often happened

withtheEDCdevicesthatstillused2Gtechnology. Inaddition,EDCdevicesneed

regular maintenance (every three weeks according to BNI). As there was only one

26

EDC device per agent/food stall, an agent in Malang was unable to provide

transactionservicesfor1.5daysbecausetheEDCdevicewasundermaintenance.

IV. Disbursement of Benefits Through Bank Accounts

67. In general, direct disbursement to the savings accounts of beneficiaries worked

well, was received in full without any fees cut, and directly disbursed to

the noncash subaccount and electronic voucher subaccount. At receiving

thefundinthesavingsaccountandsubaccount,thebeneficiarycoulddirectlyuse

the funds. Electronic vouchers could be used to purchase the prescribed food

items whereas the electronic money for other needs. There were several residual

issues related to disbursement, including: (i) the electronic money balance and

the electronicvoucher balance did not increase; (ii) the electronic money balance

increased whereas the electronic voucher did not; and (iii) the electronic money

balance did not increase whereas the electronic voucher balance increased.

68. Cellular phone-based mechanisms that use a SIM card had the advantage

and convenience in conveying information on the disbursement schedule to

the beneficiaries. BankingpartnerswereabletosendanSMSdirectlytoacellular

phone,whereas debit cards needed additional effort to inform beneficiaries about

the disbursement of funds. The information delivery method for the debit card in

thepilotwasthroughvillage/kelurahanofficialswhofurtherconveyedtheinformation

tobeneficiaries.Thismethodwaslesseffectivebecausetherewasnoguaranteethat

theinformationwouldbereceivedbythebeneficiaries.

69. In Bank Mandiri’s pilot scheme, the disbursement of benefits was done

the day after the beneficiaries opened their accounts. Before conducting

transactions, beneficiaries received a notification through SMS regarding

thedisbursementofpilotfundfromthebanktothebeneficiaryaccount.Immediately

after, Bank Mandiri sent a Personal Identification Number (PIN) number that could

beusedbythebeneficiaryinthetransactionprocess.Abeneficiarycouldnotmake

any transaction until the second SMS was received. On the day of disbursement,

the beneficiary could begin to use the pilot benefit to purchase food items at

amerchant/agent/stall/shopalreadyworkingwiththebankingpartner.

27

SUMMARY REPORT

70. Banks (BNI and BRI) disbursed benefits to the accounts of the beneficiaries.

Athavingtransferredthefundstotheaccounts,thebeneficiarieswerenotdirectly

informed. Therefore, these banks worked together with kelurahan/villageofficialsto

disseminate the information about when noncash benefits were accessible.

Beneficiarieswouldgotoamerchant/agent/stall/shoptomakeuseofthebenefits

withtheirdebitcard.Themerchant/agent/stall/shopwouldthencheckthebalance

byswipingthedebitcardontheEDCdevice.

V. Use of Benefits: Exchanging Electronic Vouchers for Food Assistance and

Electronic Money Withdrawal

71. At receiving the notification on the electronic vouchers and electronic money,

beneficiaries can come to any agent to purchase food items using the electronic

food voucher or withdraw cash from the electronic money. For food assistance,

beneficiaries can select the type and amount of food items desired from

the prescribed food items (rice, eggs, and/or milk). Agents will then calculate

thebeneficiary’sspending.Themanager/ownerofthemerchant/agent/stall/shop

will then write the type of food items purchased on a receipt and hand over

thegoods.Theamountofbeneficiary’sspendingwillthenbeusedasthebasisfor

the electronic transaction process (using the beneficiary’s cellular phone and

agent’s EDC device). Except for practice of the QR Code system; in which

the process was done manually (non-electronically).

72. During Phase I transactions, transactions tended to accumulate on the first and

second days despite socialisation about the flexibility in time to use the benefits

at the agent level. The situation started to change in Phase II as queues were no

longer seen on early days following the disbursement. Transactions generally went

well for all transaction modes used. Nevertheless, transaction issues were still found

inPhaseI,includingbeneficiariesnotunderstandingtheprocess,systemissues,and

others. Transaction processes gradually improved in Phase II.

73. Bank Jateng’s scheme and disbursement process using the QR Code technology

and transactions with the beneficiaries tended to be very simple. The transaction

schedule was informed through an invitation letter sent by the bank with

28

the support of kelurahan officials. Beneficiaries brought the invitation/notification

letter to the designated agent/food stall as indicated in the invitation letter.

BeneficiarieswerealsorequiredtobringtheirKTPandKKasproofoftheiridentity.

The letters with the QR Code also served as a transaction device. The disadvantage of

this was that transactions could occur offline and duplicate transactions of one

beneficiaryatdifferentagentswerepossible.

74. In the SIM card-based system (Bank Mandiri), shortcomings were still observed in

Phase I transactions. Beneficiaries only received one notification through SMS

(while it should have been two SMS, namely a notification on the disbursement

and an SMS with the PIN) so that the benefits could not be used. Improvements

weremadeforPhaseIItransactions.Anotherchallengewasthebeneficiaries’lackof

comprehension, particularly during Phase I, so transactions were mostly assisted by

bankfieldofficersorfacilitators.Suchfacilitatorsplayedadominantroleinguiding

theagentsandbeneficiariesinmakingthetransactions.Inaddition,somestepson

completingtheone-timepassword(OTP)procedureontheEDCdeviceweretime

limited to no more than 15 minutes. In some cases, transactions had to be repeated

from the start because beneficiaries and agents ran out of time to input

the information.

75. Beneficiaries also did not understand that there were fees for using bank/telco

services, including phone credits when reporting complaints to the consumer

call centre. All information sent in the procedurewas subject to a fee of IDR 550

(particularly for requesting PIN and OTP). This cost was charged to the remaining

balanceintheSIMcard.ProblemsoccurwhenPINandOTPrequestsmustbemade

repeatedlyduetoerrorsinfillingtheinformationorrunningoutoftime.Toaddress

this problem, banks/telcos have preloaded the SIM cards with a balance of

IDR5,000duringPhaseIdisbursement.DuringPhaseIIdisbursement,banks/telcos

requestedthebeneficiariestorefilltheirownSIMcardstofacilitatethetransaction

process.When a card is blocked because the beneficiary forgot their PIN or input

awrongPIN,theymustplaceacalltothebank/telcocallcentre.Somebeneficiaries

exhausted their phone credits when contacting the call centre before they managed

to get a new PIN.

76. In using the NFC transaction device, both the cash withdrawal as well as

29

SUMMARY REPORT

food assistance purchases using electronic vouchers generally proceeded well.

Beneficiariestendedtowithdrawalltheelectronicmoneyinonetransactionanduse

the entire electronic voucher balance following Phase I disbursement. Following

the Phase II disbursement, it required less time (5-10 minutes) compared to during

Phase I (above 10 minutes) to withdraw the electronic money as well as use

the electronic vouchers. The process was faster in Phase II because both agents and

beneficiaries had become more familiar with the transaction scheme. Although

queues were relatively long on the first day of Phase I, merchants/agents/stalls/

shopswerestillabletoservethebeneficiaries.InPhaseI,someagentsstillsought

the assistance of bank/telco facilitators, but in Phase II agents had become more

independentinprovidingcashaswellasfoodvoucherstobeneficiaries.

77. Challenges for SIM card and NFC systems in the pilot period included: (a) unstable

network conditions during the transaction; (b) PIN was not kept confidential by

beneficiaries; and (c) beneficiaries had difficulties accessing the benefits on their

ownusingtheircellularphones.Beneficiarieswhohandovertheentireprocessof

cash withdrawals and food purchases using the electronic vouchers to

the merchants/agents/stalls/shops also posed a risk of abuse by the latter.

Asaresult,thereneedstobesupervisionforeverymerchant/agent/stall/shop.

78. The challenge with the QR Code system implemented by Bank Jateng is that

noproofofthetransactionwasgiventothebeneficiaries.Recordingoftransactions

wasonlyavailablewiththeapplicationofthemerchant/agent/stall/shop.Merchants/

agents/stall/shops were able to record transactions manually/offline because

the invitation letter that served as a transaction device could be retained by

the merchant/agent/stall/shop. In practice, most merchants/agents/stalls/

shops that use this system packaged the food items (rice, egg, milk) during

the Phase I disbursement. Another error in using this system during the pilot was

that PINs were written on invitation letters that were sent openly without an envelope

—allowing any person to read it and, therefore, undermining the account security.

79. In the debit card systems (BNI and BRI), beneficiaries used the electronic money

by stating the amount of cash they intend to withdraw from the merchant/agent/

stall/shop. The merchant/agent/stall/shop would then swipe the card on their

EDCdevice,andthebeneficiarywouldinputthePIN(previouslyinformedinthePIN

30

letter). If the transaction is approved, the merchant/agent/stall/shop gives

themoneytothebeneficiaryintheamountofthebenefit.Thefooditemspurchase

procedureusingelectronicvoucherswassimilartocashwithdrawal.Thedifference

was that the merchant/agent/stall/shop would select a special menu/code,

namelythefoodelectronicvoucherwhenswipingthedebitcardontheEDCdevice.

Themerchant/agent/stall/shopwouldgivethepaymentreceipttothebeneficiary

forthepurchasedfooditemsaswellascashwithdrawalfromtheEDCdevicewhen

the transactions were successful.

80. Challenges with debit card-based transactions include, among others:

(a) information on fund transfer from the bank to the beneficiaries was not

automatically received by beneficiaries; (b) the variety of EDC devices used at

the merchant/agent/stall/shop; (c) balance transfer failures; and (d) issues

regarding e-wallets. Another challenge related to the merchants/agents/stalls/

shops if lacking the skills to operate the EDC device. The debit card system

developed by the banking partners could not lock in the types of foods purchased

by beneficiaries. This also contributed to compliance [issues] in purchasing food

items.

81. Almost all merchant/agent/stall/shop partners of BNI and BRI allowed

the purchase of other goods besides the prescribed food items. Besides issues

with the system that cannot limit the types of food items purchased, non-compliance

in limiting the types of food items that can be purchased with the electronic food

vouchers was mostly due to the lack of socialisation, so this limitation was considered

merely a suggestion. That said, all merchants/agents/stalls/shops complied with

the requirement to not sell cigarettes in transactions that use electronic vouchers.

MONITORING AND EVALUATION RESULTS

82. Monitoring and evaluation of the entire business process of the piloted

disbursement was conducted by the TNP2K Secretariat. The purpose of this

monitoring and evaluation was to: (1) learn about the process and performance

of the pilot implementation of noncash disbursements of social assistance and food

assistanceinpilotareas; (2) identifyandevaluatethesupportingfactors inpiloting

31

SUMMARY REPORT

thenoncashdisbursementsofsocialassistanceandfoodassistance;(3)identifyand

evaluate challenges that emerged during the pilot activity and strategies to

address them; and (4) provide a range of recommendations that can be used to

design improvements to a noncash disbursement mechanism for food assistance

at an extended scale.

83. Given the time and resource limitations, the monitoring of the pilot

implementation used a spot check approach. The advantage of a spot check

approach is that it can be done quickly and efficiently,while still being capable of

producing inputs for program improvements. Spot checks were done with qualitative

and quantitative methods. The qualitative method was conducted through in-depth

interviews with key informants, including beneficiaries, merchants/agents/stalls/

shops, banks/telcos, and local government/officials, direct observation, and

secondary data collection.

84. Spot checks were done in five out of eight pilot areas. The number of household/

beneficiary respondents to be interviewed was 451 households who were randomly

selected in the in the five pilot areas and out of the total of 2,937 beneficiaries.

The number of respondents at merchant/agent/stall/shop levelwas 37 out of 42

in the five pilot areas. In total, 622 respondents and informants were interviewed

through either surveys or in-depth interviews. The primary data collection process

was conducted in September-October 2016.

85. A number of field findings from the monitoring and evaluation have been

presented in this documentation. Other field findings from the monitoring and

evaluation of the pilot implementation include:

i. Based on the experience of beneficiaries using bank services, the majority

(64percent)ofbeneficiarieshadnothadsavingsinthebank,while36percent

had savings in the bank.

ii. Themajorityofrespondentsreportedthattheywereverysatisfied(59percent)

or satisfied (34 percent) with the noncash disbursement mechanism for food

assistance.

iii. Beneficiaries who were satisfied reported that the piloted Noncash Food

32

Assistance Program had some advantages compared to Raskin Program,

namely that the process was easier, access to benefit exchange/purchase

locations was easier, and there was more variety in the types of food items

received.

iv. Thosewhoweredissatisfied(eightpercent)reportedthatthe(piloted)Noncash

Food Assistance Program had a complicated registration process, the amount of

rice received was less compared to the amount in the Raskin Program, and they

werenotconfidentusingthebankaccounts/technologytoaccessthebenefits.

v. Some94percentofthe365beneficiaryrespondentsexchangedtheelectronic

vouchers at the same place for the Phase 1 and Phase 2 disbursements. Only

a very few (six percent) of beneficiaries exchanged electronic vouchers at

adifferentplace.

vi. Regarding the use of electronic vouchers to make food purchases,

62 beneficiaries (15 percent) experienced problems such as, among others:

(1) the waiting time to complete a transaction (35 percent of beneficiaries

experienced this in Phase 1 and 21 percent experienced it in Phase 2);

(2) the requirement to have a cellular phone (24 percent of beneficiaries

experiencedthisinPhase1andPhase2transactions);(3)badnetworkcoverage

(10 percent of beneficiaries experienced this in Phase 1 and 16 percent of

beneficiaries in Phase 2 transactions); and (4) unable to access the benefits

because they had no remaining balance in their accounts (six percent of

beneficiariesexperiencedthisinPhase1and13percentinPhase2transactions).

vii. The survey results of 451 beneficiaries showed that 20 percent of

the beneficiaries reported experiencing problems during registration;

34 percent reported technical problems such as lack of a cellular signal and

transactiondevicesnotworking;14percentrelatedto incompletedocuments;

and13percentofbeneficiarieswereunabletocompletetheregistrationprocess.

viii. From the 37 merchants/agents/stalls/shops who became agents of

thebanking/telcopartnersandparticipatedinthepilot,73percenthadbeenin

businessformorethanfiveyears,11percentbetweenthreetofiveyears,eight

33

SUMMARY REPORT

percent for two years, and the remainder (eight percent) had been in business

foroneyear.Merchants/agents/stalls/shopsthathadbeeninbusinesslonger

tend to do better in managing their food stock and have a strong network with

suppliers compared with those who were new to the business.

ix. The length of time that merchants/agents/stalls/shops were open and

thenumberofworkersprovidingtheservicesaffectedthebeneficiaries’access

tononcashfoodassistancebenefits.Outof37merchants/agents/stalls/shops

who became bank/telco agents and participated in the pilot, the average

operating time was 15 hours, the lowest was 11 hours, and the longest was

20.5 hours.

x. Intermsofthenumberofworkersprovidingtheservices(includingstall/shop

owners), around 43 percent of merchants/agents/stalls/shops had two

workers, 24 percent had three workers, and 22 percent had four workers.

xi. Around 87 percent of merchants/agents/stalls/shops involved in the pilot

activity stated their willingness to be involved in large-scale implementation.

Around four percent did not yet decide, whereas nine percent gave other

reasons such as the program was not yet clear to them, they experienced

difficulties when using Android applications, and were concerned that their

routine business would be disrupted.

xii. Sources of information most frequently accessed by merchants/agents/

stalls/shopswerethebankingpartnersandlocalofficials,suchasRT/RWheads

and cadres (such as from the integrated health services station or pos pelayanan

terpadu/Posyandu). Around 35.14 percent of agents received information

regarding pilot activities from the banks, 21.62 percent from banks and cadres,

and16.22percentfromRT/RW.

xiii. Merchants/agents/stalls/shops reported a number of problems they

experienced during the process of registering as an agent during the pilot.

Around 11 percent experienced difficulties, such as completing documents

(eight percent) and not being a bank customer (three percent). In the regular

agent recruitment process, each bank applied a minimum balance requirement

34

for agents, for example, Bank Mandiri IDR 100,000; BTPN IDR 250,000; BNI

IDR500,000;andBRIIDR3million.

xiv. Other problems faced by merchants/agents/stalls/shops include technical

issues such as reliability of cellular coverage and transaction devices. Some

beneficiariesmightalsoforgettobringtherequireddocumentsandforgettheir

PINs, thereby causing transaction delays.

xv. Bankingpartnersreliedontheinvitation/notificationlettertothebeneficiariesas

a communication channel for socialisation and registration during the pilot.

Thesurveyshowedthat72percentofbeneficiariesreceivedinformationabout

the Noncash Food Assistance Program in the pilot through the invitation letter,

47percentthroughtheRT/RWheads,17percentthroughthekelurahan/village

office, 14 percent through other beneficiaries/neighbours, and 19 percent

received information from other sources.

xvi. The compliance level on the type of food items purchased by beneficiaries

depended on a number of factors. These included: (1) socialisation to partner

merchants/agents/stalls/shopsandbeneficiaries;(2)knowledgeofmerchants/

agents/stalls/shops and beneficiaries about the types of food items that can

bepurchased;(3)willingnessandincentivesofmerchants/agents/stalls/shops

to convey information to beneficiaries regarding food items that can be

purchased; and (4) commitment and willingness of banking/telco partners to

monitorandimposesanctionsonmerchants/agents/stalls/shops.

xvii. Pilot beneficiaries understood that they could spend only as much as they

needanddidnothavetospendthetotalbenefitamountatonce.Thenumber

and composition of food items purchased tended tovary. Some beneficiaries

bought only one type of food item (rice), others would purchase three (rice, eggs,

and milk) at the same time. Some beneficiaries even added their own money

becausetheirpurchaseexceededIDR110,000.

xviii.At first, merchants/agents/stalls/shops that are BTPN-Telkomsel partners

were lax and did not limit the electronic voucher exchange to only three

types of prescribed food items. Because there were inconsistencies in

35

the implementation at Phase I, banking/telco partners and the local

government conducted a subsequent socialisation of merchants/agents/

stalls/shopstobestricterinservingelectronicvoucherexchanges.

xix. Basedonobservationsinthefield,itwasdifficulttoexpectmerchants/agents/

stalls/shops to ensure that electronic vouchers were only used for three

prescribed types of food items. Basically, there was no incentive for

the merchants/agents/stalls/shops to impose such limits because their

interest is to sell the goods in their shops to gain profit. In addition, therewas

a difference in the information and directions provided by teams in the field

about what could be sold so some merchants/agents/stalls/shops and

beneficiariestendedtodisregardthatrequirementdespitewarnings.

86. Summary of Pilot Outcomes. A summary of the pilot activities and outcomes of

the evaluation are presented in Table 3.

36

No

nca

sh

Dis

bu

rse

me

nt

Sta

ge

De

bit

Car

dS

IM C

ard

De

bit

Car

dQ

R C

od

e +

We

bsi

teS

IM C

ard

+ N

FC

BR

IB

ank

Man

dir

iB

NI

Ban

k Ja

ten

gB

TP

N+

Telk

om

sel

Pre

par

atio

n o

f A

ge

nts

ST

RE

NG

TH

S:

In a

ge

nt

recr

uitm

ent

, b

ank

bra

nch

es

coo

rdin

ate

with

lo

calo

ffici

als

or

use

exi

stin

g

BR

ILin

k ag

ent

s.

Trai

nin

g o

f ag

ent

s u

ses

two

me

tho

ds:

cl

ass

(co

llect

ive)

an

d s

ho

p

(ind

ivid

ual

).

Maj

orit

yo

fag

ent

sar

efo

od

sta

lls/

sho

ps.

ST

RE

NG

TH

S:

In a

ge

nt

recr

uitm

ent

, b

ank

bra

nch

es

coo

rdin

ate

with

lo

calo

ffici

als.

Trai

nin

g o

f ag

ent

s u

ses

sho

p m

eth

od

(in

div

idu

al).

Maj

orit

yo

fag

ent

sar

efo

od

sta

lls/

sho

ps.

ST

RE

NG

TH

S:

In a

ge

nt r

ecr

uitm

ent

, b

ank

bra

nch

es

coo

rdin

ate

with

loca

l o

ffici

als.

Trai

nin

g o

f ag

ent

s u

ses

sho

p m

eth

od

(in

div

idu

al) t

hat

is

inte

nsi

ve (r

ep

eat

ed

b

ank

tech

nic

al te

am

faci

litat

ion

).

Maj

orit

yo

fag

ent

sar

efo

od

sta

lls/

sho

ps.

ST

RE

NG

TH

S:

In a

ge

nt r

ecr

uitm

en

t, b

ank

bra

nch

es

coo

rdin

ate

with

loca

l o

ffici

als.

Trai

nin

g o

f ag

en

ts

use

s tw

o m

eth

od

s:

clas

s (c

olle

ctiv

e) a

nd

sh

op

(in

div

idu

al).

Maj

orit

yo

fag

en

tsa

re

foo

ds

talls

/sh

op

s.

ST

RE

NG

TH

S:

Invo

lve

s th

ird p

artie

s in

ag

ent

re

cru

itme

nt

to e

nsu

re t

hat

ag

ent

s re

cru

ited

me

et

the

ne

ed

in t

he

pilo

t ar

ea.

In a

ge

nt r

ecr

uitm

ent

, th

ird p

artie

s co

ord

inat

ew

ithlo

calo

ffici

als.

Ag

en

ts e

ng

age

d g

en

era

lly h

ave

be

en

L

aku

Pan

dai

ag

ent

s.

Trai

nin

g o

f ag

en

ts u

ses

tw

o m

eth

od

s: c

lass

(co

llect

ive)

an

d s

ho

p

me

tho

d (i

nd

ivid

ual

).

Ban

ks p

rovi

de

cas

h s

up

po

rt fo

r ag

en

ts

to fa

cilit

ate

no

nca

sh d

isb

urs

em

ent

se

rvic

es.

LIM

ITA

TIO

N:

Ban

k h

ead

qu

arte

rs

hav

e n

o u

nifo

rm

recr

uitm

ent

p

roce

du

re

be

twe

en

re

gio

ns.

LIM

ITA

TIO

N:

Trai

nin

g o

f ag

ent

s u

sin

g in

div

idu

al

me

tho

d o

nly

ris

ks in

form

atio

n

dis

tort

ion

.

LIM

ITA

TIO

N:

Trai

nin

g o

f ag

ent

s u

sin

g o

nly

th

e

ind

ivid

ual

me

tho

d

risks

info

rmat

ion

d

isto

rtio

n.

Maj

orit

yo

fag

ent

sar

e n

ew.

LIM

ITA

TIO

N:

Du

ring

tra

inin

g,

som

e a

ge

nts

still

had

diffi

cult

yo

pe

ratin

g t

ran

sact

ion

ap

plic

atio

ns

on

th

e

smar

tph

on

e.

LIM

ITA

TIO

N:

Du

ring

tra

inin

g,s

om

ea

ge

nts

still

ex

pe

rien

ced

diffi

cult

ies

ino

pe

ratin

g

cellu

lar

ph

on

e-b

ase

d t

ran

sact

ion

d

evic

es,

par

ticu

larl

y fo

r th

e r

eg

istr

atio

n

pro

cess

.

So

me

ag

ent

sar

en

ot

foo

ds

talls

/sh

op

s.

Tab

le 3

: Str

en

gth

s an

d L

imit

atio

ns

of

Pilo

t Tr

ansa

ctio

n M

od

es

No

ncash

D

isbu

rsem

en

t S

tage

De

bit C

ardS

IM C

ardD

eb

it Card

QR

Co

de

+ We

bsite

SIM

Card

+ NFC

BR

IB

ank M

and

iriB

NI

Ban

k Jaten

gB

TP

N+ Te

lkom

sel

So

me

age

nts still h

add

ifficu

lties

op

eratin

g tw

o

ED

Cd

evicesfo

re

lectro

nic vo

uch

ers.

Trainin

g m

ostly

give

n to

sho

p

own

ers, w

hile

tho

se

op

eratin

g tran

saction

d

evices are

mo

stly e

mp

loyee

s.

Majo

rityofag

entsare

n

ew.

So

cialisation

an

d E

du

cation

ST

RE

NG

TH

S:

Usin

g th

e P

oin

ts o

f Info

rmatio

n

(local acto

rs): costs

arelow

;the

reis

active p

articipatio

n

ofo

fficialsat

keluraha

n/villag

e

level;an

din

teractio

n

be

twe

en

the

In

form

ation

Ce

ntre

and

be

ne

ficiaries

can b

e d

on

e

anytime

, anywh

ere

.

ST

RE

NG

TH

S:

Usin

g th

e P

oints o

f In

form

ation

: costs

arelow

;the

reis

active p

articipatio

n

ofo

fficialsat

keluraha

n/villag

e

level;an

dinte

raction

b

etw

ee

n th

e

Info

rmatio

n C

entre

an

db

en

eficiarie

scan

be

do

ne

anytime

, anyw

he

re.

ST

RE

NG

TH

S:

Usin

g th

e P

oints

of Info

rmatio

n

Ce

ntre: co

sts are

low;th

ere

is active

p

articipatio

n

ofo

fficialsat

keluraha

n/villag

eleve

l;an

d inte

raction

b

etw

ee

n th

e

Inform

ation

C

entre

and

b

en

eficiarie

scan

be

do

ne

anytime

, anyw

he

re.

ST

RE

NG

TH

S:

Usin

g th

e P

oints o

f Info

rmatio

n: co

sts are

low;th

ere

isactive

particip

ation

of

offi

cialsatkeluraha

n/villag

eleve

l;and

inte

raction

be

twe

en

th

e Info

rmatio

n C

entre

an

db

en

eficiarie

scan

be

do

ne

anytime

, anyw

he

re.

ST

RE

NG

TH

S:

Usin

g th

e P

oints o

f Inform

ation

: costs

arelow

;the

reisactive

particip

ation

o

foffi

cialsatkeluraha

n/villag

e

level;an

dinte

raction

be

twe

en

the

Info

rmatio

nC

entre

and

be

ne

ficiaries

can b

e d

on

e anytim

e, anyw

he

re.

Th

rou

gh

third

partie

s/age

nts,info

rmatio

n can

be

un

iform

and

the

re

isdire

ctinteractio

nb

etw

ee

nfie

ld

offi

cersan

db

en

eficiarie

satho

me

.

37

No

nca

sh

Dis

bu

rse

me

nt

Sta

ge

De

bit

Car

dS

IM C

ard

De

bit

Car

dQ

R C

od

e +

We

bsi

teS

IM C

ard

+ N

FC

BR

IB

ank

Man

dir

iB

NI

Ban

k Ja

ten

gB

TP

N+

Telk

om

sel

Pre

par

atio

n o

f A

ge

nts

ST

RE

NG

TH

S:

In a

ge

nt

recr

uitm

ent

, b

ank

bra

nch

es

coo

rdin

ate

with

lo

calo

ffici

als

or

use

exi

stin

g

BR

ILin

k ag

ent

s.

Trai

nin

g o

f ag

ent

s u

ses

two

me

tho

ds:

cl

ass

(co

llect

ive)

an

d s

ho

p

(ind

ivid

ual

).

Maj

orit

yo

fag

ent

sar

efo

od

sta

lls/

sho

ps.

ST

RE

NG

TH

S:

In a

ge

nt

recr

uitm

ent

, b

ank

bra

nch

es

coo

rdin

ate

with

lo

calo

ffici

als.

Trai

nin

g o

f ag

ent

s u

ses

sho

p m

eth

od

(in

div

idu

al).

Maj

orit

yo

fag

ent

sar

efo

od

sta

lls/

sho

ps.

ST

RE

NG

TH

S:

In a

ge

nt r

ecr

uitm

ent

, b

ank

bra

nch

es

coo

rdin

ate

with

loca

l o

ffici

als.

Trai

nin

g o

f ag

ent

s u

ses

sho

p m

eth

od

(in

div

idu

al) t

hat

is

inte

nsi

ve (r

ep

eat

ed

b

ank

tech

nic

al te

am

faci

litat

ion

).

Maj

orit

yo

fag

ent

sar

efo

od

sta

lls/

sho

ps.

ST

RE

NG

TH

S:

In a

ge

nt r

ecr

uitm

en

t, b

ank

bra

nch

es

coo

rdin

ate

with

loca

l o

ffici

als.

Trai

nin

g o

f ag

en

ts

use

s tw

o m

eth

od

s:

clas

s (c

olle

ctiv

e) a

nd

sh

op

(in

div

idu

al).

Maj

orit

yo

fag

en

tsa

re

foo

ds

talls

/sh

op

s.

ST

RE

NG

TH

S:

Invo

lve

s th

ird p

artie

s in

ag

ent

re

cru

itme

nt

to e

nsu

re t

hat

ag

ent

s re

cru

ited

me

et

the

ne

ed

in t

he

pilo

t ar

ea.

In a

ge

nt r

ecr

uitm

ent

, th

ird p

artie

s co

ord

inat

ew

ithlo

calo

ffici

als.

Ag

en

ts e

ng

age

d g

en

era

lly h

ave

be

en

L

aku

Pan

dai

ag

ent

s.

Trai

nin

g o

f ag

en

ts u

ses

tw

o m

eth

od

s: c

lass

(co

llect

ive)

an

d s

ho

p

me

tho

d (i

nd

ivid

ual

).

Ban

ks p

rovi

de

cas

h s

up

po

rt fo

r ag

en

ts

to fa

cilit

ate

no

nca

sh d

isb

urs

em

ent

se

rvic

es.

LIM

ITA

TIO

N:

Ban

k h

ead

qu

arte

rs

hav

e n

o u

nifo

rm

recr

uitm

ent

p

roce

du

re

be

twe

en

re

gio

ns.

LIM

ITA

TIO

N:

Trai

nin

g o

f ag

ent

s u

sin

g in

div

idu

al

me

tho

d o

nly

ris

ks in

form

atio

n

dis

tort

ion

.

LIM

ITA

TIO

N:

Trai

nin

g o

f ag

ent

s u

sin

g o

nly

th

e

ind

ivid

ual

me

tho

d

risks

info

rmat

ion

d

isto

rtio

n.

Maj

orit

yo

fag

ent

sar

e n

ew.

LIM

ITA

TIO

N:

Du

ring

tra

inin

g,

som

e a

ge

nts

still

had

diffi

cult

yo

pe

ratin

g t

ran

sact

ion

ap

plic

atio

ns

on

th

e

smar

tph

on

e.

LIM

ITA

TIO

N:

Du

ring

tra

inin

g,s

om

ea

ge

nts

still

ex

pe

rien

ced

diffi

cult

ies

ino

pe

ratin

g

cellu

lar

ph

on

e-b

ase

d t

ran

sact

ion

d

evic

es,

par

ticu

larl

y fo

r th

e r

eg

istr

atio

n

pro

cess

.

So

me

ag

ent

sar

en

ot

foo

ds

talls

/sh

op

s. No

ncash

D

isbu

rsem

en

t S

tage

De

bit C

ardS

IM C

ardD

eb

it Card

QR

Co

de

+ We

bsite

SIM

Card

+ NFC

BR

IB

ank M

and

iriB

NI

Ban

k Jaten

gB

TP

N+ Te

lkom

sel

So

me

age

nts still h

add

ifficu

lties

op

eratin

g tw

o

ED

Cd

evicesfo

re

lectro

nic vo

uch

ers.

Trainin

g m

ostly

give

n to

sho

p

own

ers, w

hile

tho

se

op

eratin

g tran

saction

d

evices are

mo

stly e

mp

loyee

s.

Majo

rityofag

entsare

n

ew.

So

cialisation

an

d E

du

cation

ST

RE

NG

TH

S:

Usin

g th

e P

oin

ts o

f Info

rmatio

n

(local acto

rs): costs

arelow

;the

reis

active p

articipatio

n

ofo

fficialsat

keluraha

n/villag

e

level;an

din

teractio

n

be

twe

en

the

In

form

ation

Ce

ntre

and

be

ne

ficiaries

can b

e d

on

e

anytime

, anywh

ere

.

ST

RE

NG

TH

S:

Usin

g th

e P

oints o

f In

form

ation

: costs

arelow

;the

reis

active p

articipatio

n

ofo

fficialsat

keluraha

n/villag

e

level;an

dinte

raction

b

etw

ee

n th

e

Info

rmatio

n C

entre

an

db

en

eficiarie

scan

be

do

ne

anytime

, anyw

he

re.

ST

RE

NG

TH

S:

Usin

g th

e P

oints

of Info

rmatio

n

Ce

ntre: co

sts are

low;th

ere

is active

p

articipatio

n

ofo

fficialsat

keluraha

n/villag

eleve

l;an

d inte

raction

b

etw

ee

n th

e

Inform

ation

C

entre

and

b

en

eficiarie

scan

be

do

ne

anytime

, anyw

he

re.

ST

RE

NG

TH

S:

Usin

g th

e P

oints o

f Info

rmatio

n: co

sts are

low;th

ere

isactive

particip

ation

of

offi

cialsatkeluraha

n/villag

eleve

l;and

inte

raction

be

twe

en

th

e Info

rmatio

n C

entre

an

db

en

eficiarie

scan

be

do

ne

anytime

, anyw

he

re.

ST

RE

NG

TH

S:

Usin

g th

e P

oints o

f Inform

ation

: costs

arelow

;the

reisactive

particip

ation

o

foffi

cialsatkeluraha

n/villag

e

level;an

dinte

raction

be

twe

en

the

Info

rmatio

nC

entre

and

be

ne

ficiaries

can b

e d

on

e anytim

e, anyw

he

re.

Th

rou

gh

third

partie

s/age

nts,info

rmatio

n can

be

un

iform

and

the

re

isdire

ctinteractio

nb

etw

ee

nfie

ld

offi

cersan

db

en

eficiarie

satho

me

.

SUMMARY REPORT

38

No

nca

sh

Dis

bu

rse

me

nt

Sta

ge

De

bit

Car

dS

IM C

ard

De

bit

Car

dQ

R C

od

e +

We

bsi

teS

IM C

ard

+ N

FC

BR

IB

ank

Man

dir

iB

NI

Ban

k Ja

ten

gB

TP

N+

Telk

om

sel

Th

rou

gh

th

e

com

mu

nity

me

etin

g

me

tho

d, i

nfo

rmat

ion

is

un

iform

;th

ere

isd

irect

in

tera

ctio

n b

etw

ee

n

TN

P2K

Se

cre

taria

t an

d b

ank

team

s an

d

be

ne

ficia

ries;

an

dit

o

ccu

rs s

imu

ltan

eo

usl

y th

us

able

to r

eac

h

larg

e n

um

be

rs o

f b

en

efic

iarie

s.

So

cial

isat

ion

an

d E

du

cati

on

LIM

ITA

TIO

NS

:In

form

atio

n c

an v

ary

be

twe

en

Po

ints

of

Info

rmat

ion

.

LIM

ITA

TIO

NS

:In

form

atio

n c

an v

ary

be

twe

en

Po

ints

of

Info

rmat

ion

.D

isad

vant

age

of

com

mu

nity

me

etin

g

me

tho

d: r

eq

uire

s h

igh

co

st;a

de

qu

ate

fa

cilit

ysu

pp

ort

;an

d

be

ne

ficia

ries

wh

oa

re

abse

nt f

rom

me

etin

gs

do

no

t g

et

info

rmat

ion

.

LIM

ITA

TIO

NS

:In

form

atio

n c

an

vary

be

twe

en

P

oin

ts o

f In

form

atio

n.

LIM

ITA

TIO

NS

:In

form

atio

n c

an v

ary

be

twe

en

Po

ints

of

Info

rmat

ion

.

LIM

ITA

TIO

NS

:In

form

atio

n c

an v

ary

be

twe

en

P

oin

ts o

f In

form

atio

n.

Dis

adva

nta

ge

oft

hird

par

ty/

age

nt

me

tho

d: h

igh

co

st b

eca

use

p

artn

ers

mu

sth

irefi

eld

pe

rso

nn

el.

39

No

ncash

D

isbu

rsem

en

t S

tage

De

bit C

ardS

IM C

ardD

eb

it Card

QR

Co

de

+ We

bsite

SIM

Card

+ NFC

BR

IB

ank M

and

iriB

NI

Ban

k Jaten

gB

TP

N+ Te

lkom

sel

Re

gistratio

n an

d

Activatio

nS

TR

EN

GT

HS

:B

en

eficiarie

swh

o

have

accou

nts

op

en

ed

visit kelura

han/

village

o

ffice

store

giste

r,th

us d

o n

ot h

ave to

g

oto

bran

cho

ffice

.

ST

RE

NG

TH

S:

Be

ne

ficiariesw

ho

h

ave acco

unts

op

en

ed

visit kelura

han/

village

o

ffice

store

giste

r,th

us d

o n

ot h

ave to

g

oto

bran

cho

ffice

.

ST

RE

NG

TH

S:

Be

ne

ficiariesw

ho

have

acco

unts o

pe

ne

d visit

keluraha

n/villag

eo

ffice

sto

reg

ister, th

us d

o n

ot h

ave

tog

oto

bran

cho

ffice

.

Do

ne

usin

go

fflin

em

eth

od

,i.e

.op

en

ing

de

finitive

acco

unt fo

r on

e o

f the

b

en

eficiarie

sand

che

cko

f adm

inistrative

data

first,red

ucin

gre

gistratio

n

waitin

g tim

e.

ST

RE

NG

TH

S:

Re

gistratio

n an

d

activation

are d

on

e

colle

ctively w

itho

ut

involvin

gb

en

eficiarie

sso

it can b

e d

on

e

faster.

ST

RE

NG

TH

S:

Op

en

ing

ind

icative acco

unt

(‘accou

nt ho

use’) fo

r all b

en

eficiarie

sino

ne

ho

use

ho

ld

red

ucin

g th

e risk o

f erro

r o

fbe

ne

ficiarydatain

the

acco

unt.

Be

ne

ficiaryvisitsne

arest

me

rchant/ag

ent/stall/sh

op

to

reg

ister w

itho

ut h

aving

to g

o

tob

ranch

offi

ce.

Re

gistratio

n an

d

Activatio

nL

IMITA

TIO

NS

:D

on

eu

sing

offl

ine

m

eth

od

, i.e. o

pe

nin

g

de

finitive

accou

nt

foro

ne

be

ne

ficiary,w

itho

ut ch

eckin

g

adm

inistrative

data,

so w

aiting

time

d

urin

g re

gistratio

n is

lon

g.

LIM

ITAT

ION

S:

Re

gistratio

n

is all do

ne

in

on

e d

ay with

a larg

e n

um

be

r of

be

ne

ficiariesso

w

aiting

time

is lo

ng

.

LIM

ITAT

ION

S:

Th

e P

IN o

nly re

fers to

th

e acco

unt h

old

er n

ame

w

itho

ut u

sing

NIK

or

un

iqu

eID

soso

me

PIN

n

um

be

rs are m

ixed

up

.

LIM

ITAT

ION

S:

Re

gistratio

n strate

gy

that d

oe

s no

t involve

b

en

eficiarie

sispro

ne

to

misu

se o

f assistance

acco

unt.

LIM

ITAT

ION

S:

Re

gistratio

n p

roce

ss takes

time

be

cause

age

nts/b

en

eficiarie

sne

ed

tow

aitfo

r app

roval from

ban

k h

ead

qu

arters.

SUMMARY REPORT

40

No

nca

sh

Dis

bu

rse

me

nt

Sta

ge

De

bit

Car

dS

IM C

ard

De

bit

Car

dQ

R C

od

e +

W

eb

site

SIM

Car

d +

NFC

BR

IB

ank

Man

dir

iB

NI

Ban

k Ja

ten

gB

TP

N+

Telk

om

sel

Acc

ou

nt d

ata

corr

ect

ion

an

d

sup

po

rtin

g

do

cum

ent

re

qu

irem

ent

s ta

kes

time

.

E-f

orm

ap

plic

atio

ns

can

on

ly r

ead

p

ho

tos

and

sig

nat

ure

sp

eci

me

ns

that

m

atch

th

ose

in K

TP,

wh

ere

as s

om

e

be

ne

ficia

ries,

par

ticu

larl

yth

ee

lde

rly,

h

ave

diffi

cult

ies

fulfi

llin

git

.

On

line

re

gis

trat

ion

re

qu

ires

stro

ng

ce

llula

r co

vera

ge

.

Dis

bu

rse

me

nt

ST

RE

NG

TH

S:

Dis

bu

rse

me

nt

fro

m b

ank

to

be

ne

ficia

rys

avin

gs

acco

unt

is in

re

al

time

.

ST

RE

NG

TH

S:

Dis

bu

rse

me

ntf

rom

ban

kto

b

en

efic

iary

sav

ing

sac

cou

nt

is in

re

al t

ime

.

Dis

bu

rse

me

ntn

otifi

catio

n

isd

irect

tob

en

efic

iarie

sth

rou

gh

SM

S.

No

tifica

tion

isfa

st.

ST

RE

NG

TH

S:

Dis

bu

rse

me

nt

fro

m b

ank

to

be

ne

ficia

ry

savi

ng

s ac

cou

nt

is in

re

al t

ime

.

ST

RE

NG

TH

S:

Dis

bu

rse

me

nt

fro

m b

ank

to

be

ne

ficia

ry

savi

ng

s ac

cou

nt

is in

re

al t

ime

.

ST

RE

NG

TH

S:

Dis

bu

rse

me

ntf

rom

ban

kto

b

en

efic

iary

sav

ing

sac

cou

ntis

inr

eal

tim

e.

Dis

bu

rse

me

ntn

otifi

catio

nis

dire

ctto

b

en

efic

iarie

sth

rou

gh

SM

S.

No

tifica

tion

isfa

st.

LIM

ITA

TIO

NS

:D

isb

urs

em

ent

sc

he

du

le

no

tifica

tion

mu

st

invo

lve

loca

l o

ffici

als

and

ag

ent

sb

eca

use

ban

ks d

o

no

t h

ave

dire

ct

LIM

ITA

TIO

NS

:D

isb

urs

em

ent

sch

ed

ule

n

otifi

catio

nt

hro

ug

hS

MS

is

mis

sed

by

be

ne

ficia

ries

wh

o

do

no

t ow

n a

ce

llula

r p

ho

ne

.

LIM

ITA

TIO

NS

:D

isb

urs

em

ent

sc

he

du

le

no

tifica

tion

mu

st

invo

lve

loca

l o

ffici

als

and

ag

ent

s b

eca

use

b

anks

do

no

t h

ave

dire

ct.

LIM

ITA

TIO

NS

:D

isb

urs

em

ent

sc

he

du

le

no

tifica

tion

mu

st

invo

lve

loca

l o

ffici

als

and

ag

en

ts b

eca

use

b

anks

do

no

t h

ave

dire

ct.

LIM

ITA

TIO

NS

:D

isb

urs

em

ent

sch

ed

ule

no

tifica

tion

th

rou

gh

SM

Sis

mis

sed

by

be

ne

ficia

ries

wh

od

on

ot

own

ce

llula

rp

ho

ne

s.

SUMMARY REPORT

41

No

nca

sh

Dis

bu

rse

me

nt

Sta

ge

De

bit

Car

dS

IM C

ard

De

bit

Car

dQ

R C

od

e +

W

eb

site

SIM

Car

d +

NFC

BR

IB

ank

Man

dir

iB

NI

Ban

k Ja

ten

gB

TP

N+

Telk

om

sel

Acc

ou

nt d

ata

corr

ect

ion

an

d

sup

po

rtin

g

do

cum

ent

re

qu

irem

ent

s ta

kes

time

.

E-f

orm

ap

plic

atio

ns

can

on

ly r

ead

p

ho

tos

and

sig

nat

ure

sp

eci

me

ns

that

m

atch

th

ose

in K

TP,

wh

ere

as s

om

e

be

ne

ficia

ries,

par

ticu

larl

yth

ee

lde

rly,

h

ave

diffi

cult

ies

fulfi

llin

git

.

On

line

re

gis

trat

ion

re

qu

ires

stro

ng

ce

llula

r co

vera

ge

.

Dis

bu

rse

me

nt

ST

RE

NG

TH

S:

Dis

bu

rse

me

nt

fro

m b

ank

to

be

ne

ficia

rys

avin

gs

acco

unt

is in

re

al

time

.

ST

RE

NG

TH

S:

Dis

bu

rse

me

ntf

rom

ban

kto

b

en

efic

iary

sav

ing

sac

cou

nt

is in

re

al t

ime

.

Dis

bu

rse

me

ntn

otifi

catio

n

isd

irect

tob

en

efic

iarie

sth

rou

gh

SM

S.

No

tifica

tion

isfa

st.

ST

RE

NG

TH

S:

Dis

bu

rse

me

nt

fro

m b

ank

to

be

ne

ficia

ry

savi

ng

s ac

cou

nt

is in

re

al t

ime

.

ST

RE

NG

TH

S:

Dis

bu

rse

me

nt

fro

m b

ank

to

be

ne

ficia

ry

savi

ng

s ac

cou

nt

is in

re

al t

ime

.

ST

RE

NG

TH

S:

Dis

bu

rse

me

ntf

rom

ban

kto

b

en

efic

iary

sav

ing

sac

cou

ntis

inr

eal

tim

e.

Dis

bu

rse

me

ntn

otifi

catio

nis

dire

ctto

b

en

efic

iarie

sth

rou

gh

SM

S.

No

tifica

tion

isfa

st.

LIM

ITA

TIO

NS

:D

isb

urs

em

ent

sc

he

du

le

no

tifica

tion

mu

st

invo

lve

loca

l o

ffici

als

and

ag

ent

sb

eca

use

ban

ks d

o

no

t h

ave

dire

ct

LIM

ITA

TIO

NS

:D

isb

urs

em

ent

sch

ed

ule

n

otifi

catio

nt

hro

ug

hS

MS

is

mis

sed

by

be

ne

ficia

ries

wh

o

do

no

t ow

n a

ce

llula

r p

ho

ne

.

LIM

ITA

TIO

NS

:D

isb

urs

em

ent

sc

he

du

le

no

tifica

tion

mu

st

invo

lve

loca

l o

ffici

als

and

ag

ent

s b

eca

use

b

anks

do

no

t h

ave

dire

ct.

LIM

ITA

TIO

NS

:D

isb

urs

em

ent

sc

he

du

le

no

tifica

tion

mu

st

invo

lve

loca

l o

ffici

als

and

ag

en

ts b

eca

use

b

anks

do

no

t h

ave

dire

ct.

LIM

ITA

TIO

NS

:D

isb

urs

em

ent

sch

ed

ule

no

tifica

tion

th

rou

gh

SM

Sis

mis

sed

by

be

ne

ficia

ries

wh

od

on

ot

own

ce

llula

rp

ho

ne

s.

No

ncash

D

isbu

rsem

en

t S

tage

De

bit C

ardS

IM C

ardD

eb

it Card

QR

Co

de

+ We

bsite

SIM

Card

+ NFC

BR

IB

ank M

and

iriB

NI

Ban

k Jaten

gB

TP

N+ Te

lkom

sel

no

tification

m

ech

anism

s to

be

ne

ficiaries.

No

tification

takes

time

.

Ne

ed

min

imu

m b

alance

to

en

sure

the

SIM

card

rem

ains active

.

no

tification

m

ech

anism

s to

be

ne

ficiaries.

No

tification

takestim

e.

no

tification

me

chan

ismsto

b

en

eficiarie

s.

No

tification

takestim

e.

Ne

ed

min

imu

m

balan

ce to

en

sure

th

eS

IMcard

rem

ains

active.

Use

of

Transactio

n

Eq

uip

me

nt

and

Assistan

ce

Utilizatio

n

ST

RE

NG

TH

S:

Ab

le to

targe

t 10

0%

of

be

ne

ficiaries.

Mo

rem

erch

ants/

ag

en

ts are u

sed

to

this te

chn

olo

gy in

tran

saction

s.

Co

nn

ecte

dto

AT

M

wh

en

makin

g cash

w

ithd

rawals.

ST

RE

NG

TH

S:

Co

st-effe

ctivefo

rbo

th

ban

ksand

age

nts/

me

rchan

ts.

Bo

thag

ents/

me

rchants

and

ban

ks do

no

t ne

ed

ad

ditio

nal e

qu

ipm

ent.

In th

e lo

ng

term

will b

e

easie

r to u

se b

ecau

se

cellu

lar tech

no

log

y p

en

etratio

n w

ill be

mo

re

wid

esp

read

.

Disb

urse

me

ntn

otificatio

nise

asyusin

g

SM

S.

ST

RE

NG

TH

S:

Ab

le to

targe

t 100

% o

f b

en

eficiarie

s.

Mo

rem

erch

ants/

age

nts are u

sed

to

this te

chn

olo

gy in

tran

saction

s.

Co

nn

ecte

dto

AT

M

wh

en

makin

g cash

w

ithd

rawals.

ST

RE

NG

TH

S:

In th

e lo

ng

term

will b

e e

asier to

u

se b

ecau

se ce

llular te

chn

olo

gy

pe

ne

tration

will b

e m

ore

w

ide

spre

ad.

QR

Co

de

can re

place

the

fu

nctio

n o

f PIN

.

ST

RE

NG

TH

S:

Co

st-effe

ctivefo

rb

oth

ban

ks and

ag

ents/

me

rchants.

Bo

thag

ents/

me

rchants an

d

ban

ks do

no

t ne

ed

ad

ditio

nal e

qu

ipm

ent.

In th

e lo

ng

term

w

ill be

easie

r to

use

be

cause

ce

llular te

chn

olo

gy

pe

ne

tration

will b

e

mo

re w

ide

spre

ad.

Disb

urse

me

ntn

otificatio

nise

asyu

sing

SM

S.

SUMMARY REPORT

42

No

nca

sh

Dis

bu

rse

me

nt

Sta

ge

De

bit

Car

dS

IM C

ard

De

bit

Car

dQ

R C

od

e +

We

bsi

teS

IM C

ard

+ N

FC

BR

IB

ank

Man

dir

iB

NI

Ban

k Ja

ten

gB

TP

N+

Telk

om

sel

Use

of

Tran

sact

ion

E

qu

ipm

en

t an

d A

ssis

tan

ce

Uti

lizat

ion

LIM

ITA

TIO

NS

:M

ore

exp

en

sive

be

cau

se

itre

qu

ires

ED

Cd

evic

efo

rtr

ansa

ctio

n.

Mo

ree

xpe

nsi

veb

eca

use

b

anks

mu

st p

rint

de

bit

card

s in

larg

e n

um

be

rs.

De

bit

card

isa

na

dd

itio

nal

in

stru

me

nt t

hat

mu

st b

e h

eld

b

yb

en

efic

iarie

san

d,i

flo

st,

the

pro

cess

of r

ep

laci

ng

it

mu

st b

e d

on

e in

bra

nch

es

and

is t

ime

-co

nsu

min

g.

Alt

ho

ug

h P

IN e

nsu

res

tran

sact

ion

se

curit

y, s

om

e

be

ne

ficia

ries

still

hav

e

diffi

cult

ym

em

oriz

ing

it.

No

tifica

tion

on

dis

bu

rse

me

nt

is n

ot

eas

y to

do

.

Th

ere

are

stil

l fo

od

p

urc

has

es

ou

tsid

e t

he

p

resc

ribe

d li

st.

LIM

ITA

TIO

NS

:N

ot

all

be

ne

ficia

ries

hav

e c

ellu

lar

ph

on

es.

Th

e e

lde

rly

still

fa

ce p

rob

lem

s in

usi

ng

ce

llula

r p

ho

ne

-bas

ed

tr

ansa

ctio

ns.

Ne

ed

PIN

for

tran

sact

ion

se

curit

y.B

anks

ne

ed

to

pro

vid

eE

DC

d

evic

e fo

r tr

ansa

ctio

ns

ata

ge

nts/

m

erc

han

ts.

Th

ere

are

stil

l fo

od

pu

rch

ase

s o

uts

ide

th

e

pre

scrib

ed

list

.

LIM

ITA

TIO

NS

:M

ore

exp

en

sive

be

cau

se

itre

qu

ires

ED

Cd

evic

efo

rtr

ansa

ctio

n.

Mo

ree

xpe

nsi

veb

eca

use

b

anks

mu

st p

rint

de

bit

card

s in

larg

e n

um

be

rs.

De

bit

card

isa

na

dd

itio

nal

in

stru

me

nt t

hat

mu

st b

e h

eld

b

yb

en

efic

iarie

san

d,i

flo

st,

the

pro

cess

of r

ep

laci

ng

it

mu

st b

e d

on

e in

bra

nch

es

and

is

tim

e-c

on

sum

ing

.

Alt

ho

ug

h P

IN e

nsu

res

tran

sact

ion

se

curit

y, s

om

e

be

ne

ficia

ries

still

hav

e

diffi

cult

ym

em

oriz

ing

it.

No

tifica

tion

on

dis

bu

rse

me

nt

is n

ot

eas

y to

do

.

Th

ere

are

stil

l fo

od

pu

rch

ase

s o

uts

ide

th

e p

resc

ribe

d li

st.

LIM

ITA

TIO

NS

:A

ge

nts

/m

erc

han

ts

and

ban

ks n

ee

d

add

itio

nal

eq

uip

me

nt,

an A

nd

roid

-bas

ed

sm

artp

ho

ne

.

QR

co

de

is e

asily

d

amag

ed

as

it is

p

rinte

d o

n in

vita

tion

le

tte

r.

Be

ne

ficia

ries

do

no

tg

et

a tr

ansa

ctio

n

rece

ipt.

Th

e p

ract

ice

of

pac

kag

ing

foo

d

assi

stan

ce is

stil

l fo

un

d, p

artic

ula

rly

in P

has

e I

of

dis

bu

rse

me

nt.

LIM

ITA

TIO

NS

:N

ot

allb

en

efic

iarie

sh

ave

ce

llula

r p

ho

ne

s.

Th

e e

lde

rly

still

face

p

rob

lem

s in

usi

ng

ce

llula

r p

ho

ne

-bas

ed

tr

ansa

ctio

ns.

Ne

ed

PIN

for

tran

sact

ion

se

curit

y.

Th

e p

ract

ice

of

pac

kag

ing

foo

d

assi

stan

ce is

stil

l fo

un

d, p

artic

ula

rly

by

age

nts

/m

erc

han

ts

that

had

no

t so

ld fo

od

ite

ms

be

fore

.

43

RECOMMENDATIONS

The pilot activity provides the following recommendations in preparing the plans of

the Government of Indonesia to improve the Raskin Program by employing the noncash

banking disbursement mechanism:

a. Preparing the Beneficiary Data

i. If time is sufficient, a recheck of potential beneficiaries should be done by

the local government at the kelurahan level and a data updating application can

be provided to input data at the kelurahan level.

ii. If time is limited, a recheck of potential beneficiaries can be done alongside

registration at the kelurahan level jointly by kelurahan and bank officers by

openingaspecial‘townhall’counter/desk.

b. Socialisation, Education, and Notification to Beneficiaries

i. Given that noncash food assistance is a new program, socialisation is very

important and needs to be executed very well.

ii. Socialisation for implementing noncash food assistance should be done by

conveyingtwomainmessages,namely:informationabouttheprograminwhole;

and the disbursement mechanism in the pilot, including registration and

transaction locations.

iii. A combination of means/devices for socialisation needs to be employed,

including letters, audio visuals, guidebooks, information sheets, list of

merchants/agents/stalls/shops, posters to provide an understanding to

beneficiariesandmerchants/agents/stalls/shops.

iv. A Person-in-Charge (PIC) needs to be determined to receive further information

and confirmation to address misunderstandings about the program (purpose,

objective, scope of activities, and other related matters).

v. Educationtobeneficiariesandbanks’merchants/agents/stalls/shopspartners

shall be done intensively at the beginning of the program to increase

SUMMARY REPORT

44

understanding about assistance disbursement, both for social and food

assistance.

vi. Topics to be covered in this education include: (1) ways of using certain

transaction modes in using the benefits to be received; (2) the significance of

the PIN and its use aswell as the need for confidentiality and consequences

if the PIN is no longer confidential; (3) role of agents in the noncash

disbursementsofsocialandfoodassistances; (4) therightsandobligationsof

merchants/agents/stalls/shops as partners of banks, how to use transaction

modes, and types of program benefits. It is also important to emphasize in

the socialisation and education that beneficiaries are not allowed to purchase

other types of food, outside those prescribed.

c. Transaction Modes/Devices, Registration, and Activation

i. Program implementers need to consider the strengths and limitations of each

transactionmode/devicepriortodecidingonthetransactionmode/deviceto

be used.

ii. Debitcardsorcellularphoneshavetheirownstrengthsandlimitations,sorelying

ononetypeoftransactionmode/devicetobeusedforanational-scaleprogram

risks hindering disbursement. In addition, banks participating in the program

need to apply risk management and innovation with respect to transaction

modes/devicetobeused.

iii. There needs to be support from the local government to provide the required

identification documents or certificates. Opening a bank account requires

identification documents such as KTP (ID Card) and Family Registration Card

(Kartu Keluarga/KK) to meet the bank’s KYC requirements and not all

beneficiaryfamilieshavetherequireddocuments.

d. Availability and Distribution of Agents/Stalls/Shops

i. The number of bank agents is currently not sufficient.The ratio of merchant/

agent/stall/shoptobeneficiariesshouldideallybe1:150,therefore,thenumber

of agents needs to be increased to meet this ratio.

45

ii. Banks need to have at least two merchants/agents/stalls/shops in one

kelurahan/village. This is to ensure that beneficiaries have a choice, to avoid

excesspricingor theprovisionofgoodswithsubparqualityat themerchant/

agent/stall/shop level, and to provide support if there are problems with

transactionequipmentinanymerchant/agent/stall/shopfacility.

iii. Banks need to consider OJK requirements regarding recruitment of Laku Pandai

agentssotherewillbenodelays/hindrancesinrecruitingmerchants/agents/

stalls/shops to support the noncash disbursements of food and social

assistances.

iv. MerchantswhoarealreadybankagentswithIndonesianlegalentitystatusneed

to be involved to ensure that their numbers are sufficient to implement the

noncash food assistance program in 2017.

v. Banks need to conduct regular training for merchants/agents/stalls/shops,

particularly in how to operate transaction devices.

vi. Banks need to provide a technical support team in every region to assist

merchants/agents/stalls/shopswhenneeded.

e. Improving the Effectiveness of Implementing the Noncash Mechanism

i. Food items to be available at merchants/agents/stalls/shops aswell as their

equivalent pricing and quality need to be formulated.

ii. Variations in the types of food (for instance rice variants sold) at merchants/

agents/stalls/shopsdeterminethevarietyofchoice/purchasingbybeneficiaries.

iii. Independent registration mechanism for all retailers to apply for becoming

merchants/agents/stalls/shopsservingnoncashtransactionsisneeded.

iv. Mechanismforinvolvementandactiveroleofstakeholdersatkelurahan/village

levelinidentifyingpotentialmerchants/agents/stalls/shopsisneeded.

v. Improving information networks and cooperation is needed between

SUMMARY REPORT

46

merchants/agents/stalls/shopsandfoodsuppliers/distributors.

vi. Liquiditysupportformerchants/agents/stalls/shopsisneededtoprovidecash

withdrawal services (for the electronic money).

f. Exchanging Electronic Food Vouchers and Withdrawing Electronic Money

i. Inexchangingelectronicvoucherstoobtainin-kindbenefits,merchants/agents/

stalls/shops are obligated to provide: (1) proof of transaction and balance

informationtobeneficiaries;and(2)clearinformationtothebeneficiariesabout

the price of rice, eggs, and milk sold —for example, by displaying the price of

every type of food item.

ii. In cash withdrawals of the electronic money, banks must ensure that

beneficiaries can make the withdrawals through merchants/agents/stalls/

shopsbyensuringtheirliquidityand/orattheclosestATMatlowcost.

g. Service to Beneficiaries

i. Ensuring there is a complaint mechanism regarding products, the program, and

themanagementinthefield.

ii. Banksandthelocalgovernmentsprovideaspecialmechanismforbeneficiaries

who are elderly, vulnerable, and with special needs during the socialisation,

openingofaccounts,andutilizationofbenefits.

h. Involvement of the Local Government

In the implementation of the social and food assistance program, local

government should:

i. Play an active role in the program implementation, particularly in data validation

andverificationofbeneficiariesandsocialisationactivities;

ii. Togetherwithbanks,conductidentificationofprospectivemerchants/agents/

stalls/shops to be merchants/agents for noncash food assistance

disbursements.

iii. Play a role as information provider for the program and as a complaint channel.

47

HASIL IDENTIFIKASI

iv. Play an active role to suppress the practice of price fixing at the merchant/

agent/stall/shoplevel;and

v. Provideadministrativesupportinfilingforabusinesslicense(Surat Keterangan

Usaha/SKU)formicro-scalefoodsellerswhowanttoparticipateinthenoncash

food assistance program.

vi. Provideinformationregardingvariousissuesandtheirhandlinginthefield.

vii. Conductregularmonitoringonprogramimplementationinthefield.

i. Improving Transaction System and Infrastructure at the Agent/Merchant Level

i. ProgramimplementersneedtocoordinatewiththeMinistryofCommunication

and Informatics (Kementerian Komunikasi dan Informatika/Kemenkominfo)

to minimize the risk of cellular signal disruption to increase the success of

electronic transactions in every region.

ii. Ensuringinteroperabilityofbankagentssobeneficiariescanvisitanymerchant/

agent/stall/shop from different banks to conduct transactions. This will allow

increasedaccesstofoodassistanceinthefield.

iii. Continuity and sustainability of merchants/agents/stalls/shops. Agents must

have food stocks for the food assistance program and have the financial

incentive to conduct cash transfers, particularly for cash transfer programs.

48

49

50

THE NATIONAL TEAM FOR THE ACCELERATION OF POVERTY REDUCTION

Office of the Vice President of the Republic of Indonesia

Jl. Kebon Sirih No. 14, Jakarta Pusat 10110

Phone : (021) 3912812

Fax : (021) 3912511

E-mail : pokjabansos@tnp2k.go.id

Website : www.tnp2k.go.id