VZCZCXYZ0027
PP RUEHWEB

DE RUEHBUL #3096/01 2780658
ZNR UUUUU ZZH
P 050658Z OCT 09
FM AMEMBASSY KABUL
TO RUEHC/SECSTATE WASHDC PRIORITY 1828
RUEATRS/DEPT OF TREASURY WASHINGTON DC 0896

UNCLAS KABUL 003096 
 
SENSITIVE 
SIPDIS 
 
DEPT FOR SRAP, SCA/FO, SCA/RA, AND SCA/A 
DEPT PASS AID/ASIA BUREAU 
CENTCOM FOR CSTC-A, USFOR-A 
TREASURY FOR AWELLER, JCASAL AND MNUGENT 
 
E.O. 12958: N/A 
TAGS: EFIN EAID PGOV AF
SUBJECT: Central Bank Agrees to Continue and Expand Mobile Money 
Pilot Project 
 
REF: KABUL 3077 
 
¶1. (SBU) SUMMARY: Afghanistan's Central Bank Governor Abdul Qadeer 
Fitrat has agreed to extend indefinitely a mobile money pilot 
(m-Money) with the Afghan National Police (ANP) in Wardak province. 
In an October 1 meeting with EmbOffs, CSTC-A representatives, 
m-Money program participants, and mobile telephone operating company 
Roshan, Fitrat also authorized expanding the pilot with ANP to other 
provinces as well as additional Afghan ministries.  According to 
Roshan, the program operator, and CSTC-A, the military element 
overseeing the Wardak pilot, the program in Wardak province has been 
very successful and ANP officers' take-home salaries are 30 percent 
higher than when they received them in cash.  Although there were 
some administrative challenges in the initial stages of the Wardak 
rollout, participants expect they will be overcome as the pilot 
expands to additional provinces.  Fitrat also discussed problems 
Kabul Bank is having paying government salaries and asked Roshan 
representatives to select m-Money agents carefully to ensure 
customers are protected.  Overall, Fitrat is satisfied with the 
m-Money pilot and supportive of its expansion. END SUMMARY. 
 
¶2. (SBU) On October 1, Treasury Attach and Senior Deputy 
Coordinating Director for Development and Economic Affairs discussed 
bank expansion and continuation of Roshan's ANP salary disbursement 
project in Warkdak province, Jalreez district with Central Bank 
Governor Fitrat.  Representatives of the U.S. Training Command 
(CSTC-A), which helped with coordination and implementation efforts 
on this project, also participated.  CSTC-A, along Roshan executives 
outlined the Wardak pilot and argued to continue it and expand 
m-Money services to additional provinces and Afghan ministries. 
Fitrat agreed to continue the Wardak pilot indefinitely, expand ANP 
pilots and explore additional pilots with other Afghan ministries 
(e.g., Ministry of Energy and Water for payment of electricity 
bills; payment of salaries for Ministry of Education). 
 
¶3. (SBU) The combined Roshan/CSTC-A brief pointed out several 
important aspects of the ongoing Wardak pilot project.  First, the 
ANP officers participating in the program are pleased with the 
pilot's results.  Several ANP officers reported their salary is 30 
percent higher than they thought, an important metric demonstrating 
the technology's ability to reduce skimming and other corruption. 
Second, Roshan found the Ministry of Interior had not been fully 
supportive or prepared to start the process when the pilot was 
launched, failing to provide dedicated personnel resources.  While 
these problems were overcome during the pilot, a more robust system 
is necessary for a broader roll-out of m-Money salary disbursement. 
Finally, Roshan, CSTC-A, and the Ministry of Interior will continue 
the pilot in Wardak indefinitely and begin similar pilot programs in 
other provinces soon.  CSTC-A presented Fitrat with notional 
expansion provinces based on the following criteria: a) banking 
payroll method; b) distances to and from the nearest bank versus an 
M-Paisa agent; c) cellular telephone coverage; and d) the province's 
threat level.  Based on this assessment, CSTC-A recommended Patika, 
Farah, Khost, Kandahar, and Ghazni as sites for additional m-Money 
salary payment pilots. 
 
¶4. (SBU) Fitrat also noted concern over Kabul Bank's inability to 
deliver government salary payments before the Eid holiday and 
indicated he would like to distribute government salary payment 
contracts (which the Ministry of Finance competed and awarded to 
Kabul Bank) among other banks or ensure Kabul Bank can improve its 
capacity moving forward.  On a similar note, Fitrat asked Roshan to 
select its agents carefully and take precautions to safeguard its 
customers.  Roshan executives noted they are selecting and equipping 
qualified agents and expect to have 500 in place nationwide by the 
end of the year.  They also told Fitrat negotiations are underway 
with Azizi Bank, Maiwand Bank, and First MicroFinance Bank as 
potential agents for M-Paisa (which is Roshan's m-Money platform) 
and asked for his help in more successfully engaging licensed money 
service providers. 
 
¶5. (SBU) COMMENT: Fitrat praised all those involved in the project 
using mobile banking to pay ANP salaries and its impact on spreading 
technology to the local level in Afghanistan.  He promised the 
Central Bank will quickly address matters related to expanding 
mobile money and offered to facilitate meetings with various 
financial sector entities per Roshan's request.  Following the 
meeting, Roshan executives and CSTC-A both noted they were pleased 
with the outcome of the meeting and would begin work immediately to 
implement a broader ANP rollout, as well as new pilots with other 
ministries.  Regulations for m-commerce, which will formalize 
procedures for m-Money transactions, are out for public comment and 
due to be reviewed by the Central Bank's Supreme Council at the end 
of October.  Once adopted, Roshan and other service providers will 
be able to move beyond pilots to full roll-out of these services 
according to the regulations. 
 
EIKENBERRY