Government to Beneficiary Payments in Nepal: A Pilot Study

Context

After the 2015 earthquake in Nepal, the National Reconstruction Authority (NRA) set out to develop an efficient and cost-effective payment system for home reconstruction. With a pilot grant from the Financial Inclusion Lab (FIL), Professor Callen studied how households in the village of Laprak, as well as stakeholders in the banking sector, viewed the possibility of deploying a mobile grant payment system.

Study Design

Researchers conducted nearly 500 household surveys, ran focus group discussions, and leveraged secondary data provided by the NRA to produce a number of insights on the mobile payments technology. In addition, the study worked to develop partnerships with private sector partners and local policy makers to identify obstacles to implementation.

Results and Policy Lessons

The study found that households valued mobile technology significantly. While the majority said they preferred the digitized system, many also conveyed risk aversion, a poor understanding of mobile payments, and other reasons for favoring conventional payments. This project helped to build government capacity in data collection and management, and contributed to a more robust environment for the implementation, regulation, and to frame policy discussions around direct-to-beneficiary mobile payments in Nepal.