Daily Times

The usage of physical cash centres for the government’s Ehsaas disbursements has been flagged by observers as an example of failure to properly make use of information and physical resources. What was needed was a clear elucidation of the usage of digital payment channels from the State Bank due to the close linkage of poverty alleviation with financial inclusion. With this in place, Dr Nishtar could have been better placed to make decisions regarding the channels being used on this particular program, or more adequately, informed as to the channels available through such mechanisms as the Asaan Mobile Account, which links together around four telecommunications companies and several of the major banks for special accounts that are accessed by the underbanked populations via mobile app software.

The general position here is that Dr Nishtar is being used for poverty alleviation when her expertise is in policy formation, particularly around health emergencies. The PM should take a back seat and allow her to steer the situation to some form of normality, with a rapidly spiralling situation involving numbers of infected people going beyond 96,000, and exploitation of the “smart-lockdown” policy to mean “free-roaming without facemasks.”

Allowing him to take the lead means that the country is going forward into the eagerly awaiting “coronavirus ambush” that lies ahead, with nothing to guide the largely unlearned population other than speeches by the PM, akin to the Twitter-based comms strategy used by his US-based counterpart. Policy on this critical area is generally lacking, with all members of the cabinet chipping in to give their two cents; when what is needed is expert management. The areas of testing, usage of medical facilities, the supply of equipment, sources of infection, lockdown versus smart lockdown, method of earning a livelihood, and enforcing awareness of the above with social distancing needed clear formulation from day one, which we do not have in place. All of the above concerns could easily have been formulated up to the WHO level standards even, with just Dr Nishtar and a small team of doctors, but rather it has been left to others, while the good doctor is found to be on the racecourse wearing blinders.

The coronavirus has its own set of supply-related needs, with specific reference to the PPE units and now the supply of the antiviral drug “Remdesvir,” originally developed as a treatment for Ebola, which will now be supplied to Pakistan and India from Gilead, a US pharmaceutical firm. By impersonating “the Lone Ranger” and handling this aspect himself, the PM is directly contributing to a state of confusion and lack of coordination, which is inevitably giving fuel to his opposition, while his loyal counterpart “Tonto” is sent off to relief centres disguised in a burka. Since the honourable lady has been tethered and stabled to the mission of poverty alleviation, we have no choice but to seek signs of hope in the developments related to the delivery of relief payments, but even there we may find discrepancies.

The administration of the Kafalat programme has been given some degree of consideration with regards to the provisions for hygiene and maintenance of COVID-19 risk protocols, in light of the recent critique by the CM Sindh with regards to the usage of thumb impression devices. The programme was suspended briefly from mid-March to April 5, as a part of prevention measures against COVID-19. The usage of biometric payments has been allowed to remain enabled, and the Poverty Alleviation division has mentioned that preventative measures are being kept to ensure the safety of beneficiaries. Poverty Alleviation Division has advised the participating banks to ensure that sanitisers are available at all payment points during the provision of services. Before fingerprints’ verification, the beneficiaries are being guided as to how to wash hands with sanitizers and alcoholic wipes. After the use of biometric devices, beneficiaries are guided to rewash their hands with soaps and sanitisers, to ensure minimising the risk of infection.

Dr Nishtar is being used for poverty alleviation when her expertise is in policy formation, particularly around health emergencies

Special Assistant to the Prime Minister on Poverty Alleviation and Social Protection, Dr Sania Nishtar, said that “precautionary decisions have been taken to avoid the risk of contributing to the potential spread of the epidemic.”

She states in an interview with Pakistan Today, “We had an easy option to temporarily suspend the Kafalat disbursements, but we preferred to cater to the pressing financial needs of the women beneficiaries by ensuring their health and safety in this situation.” Insofar as the usage of digital payment channels is concerned, the usage of biometric technology has been identified by the government as the key mechanism selected to make the process of administering cash payments compliant with the most up to date technology in payment processing.

Asst to PM has inaugurated the installation of new biometric ATMs in Melody Market Islamabad for beneficiaries of Ehsaas Kafalat. There has been an effort to create what they call an “Ehsaas Digital Payment System,” which involved a 10-month procurement process, only involving two banks, i.e. HBL and Bank Alfalah, and is considered to be an upgrade/development from the earlier BISP payment system in many respects. The new system has done away with money orders and debit cards and relies only on biometric verification for identifying beneficiaries. It is not “simply a payment system,” but includes savings features as well. They state that the new system will allow beneficiaries to go to a variety of outlets, i.e. a) retail shop, b) biometrically enabled bank branch or c) biometric-enabled ATM. This is considered to be the main unique feature of the government’s new Ehsaas payment system.

The government believes that the new biometric channels have increased security, due to how previously women used to visit retail agents only, and they used to charge for verifications, as is currently being done across the country at an alarming rate. Nishtar believes that access to the bank branches alone is something which provides empowerment and dignity to women. It is also unavoidable to notice that the government was very vocal concerning the transparency of the new HBL biometric ATMs, convinced that their usage would be effective in curtailing the effects of the monopoly of money transfer agents. Paradoxically, it was the agents who took advantage of the Distribution Center management system and completely sidestepped any form of security supposedly developed through the introduction of a biometric ATM. This incident forms the core case study for promoting privately owned, digital-only channels in direct opposition to the illicit activities of agent cartels. What could have been done is to upgrade the scope of the AMA Scheme, and use that arrangement of national payments infrastructure to boost financial inclusion and provide relief simultaneously, rather than reinventing the wheel and making it square-shaped?

The government has also launched a web portal to check eligibility of applicants for the emergency cash program on the NADRA website in April 2020. This represents a good step towards removing the usage of physical locations, as those who were previously instructed via SMS to contact local administration offices, were able to provide the same information via web-portal. Even though this may have caused cybersecurity concerns down the line, the government faced a scenario of relative compromise before the actual launch of the portal, involving the initiation of a fake web portal by scammers looking to take advantage of the crisis to obtain personal details of potential applicants, referring to them, the SAPM tweeted to “be aware of the digital mafia.”

The design of a new state-backed program that will allow the registration of users of government services and easy access to their personal information; will create a more efficient way of verifying applicants to the government or other private emergency financial services, through a digital technology, which operates based on a basic two-step verification process. Pakistanis use NADRA, and Indians use Aadhar, and both of these are state-operated methods to facilitate KYC processes for a variety of private and publicly operated services. However, where we can perhaps see some change is in the usage of advanced technology so that the verification of user identity can be performed from a variety of locations, which would be of great utility in times such as the present where there is a need to keep people far away from each other or equally if there is no possibility of bringing users into a single location to access a service. For such cases, it is worthwhile to come up with a single digital identity system that allows users to log in and verify details and then make use of a unified transaction/purchase processing mechanism. This will perhaps save time and cost of managing integral services.

The writer is a Research Consultant at a Financial Services Technology Group