The World Bank Implementation Status & Results Report Somalia Capacity Advancement, Livelihoods and Entrepreneurship, through Digital Uplift Project (SCALED-UP) (P168115) Somalia Capacity Advancement, Livelihoods and Entrepreneurship, through Digital Uplift Project (SCALED-UP) (P168115) AFRICA | Somalia | Finance, Competitiveness and Innovation Global Practice | IBRD/IDA | Investment Project Financing | FY 2019 | Seq No: 2 | ARCHIVED on 17-Dec-2019 | ISR38838 | Implementing Agencies: Ministry of Finance, Federal Republic of Somalia, Ministry of Finance, Federal Republic of Somalia Key Dates Key Project Dates Bank Approval Date: 07-Mar-2019 Effectiveness Date: 08-Aug-2019 Planned Mid Term Review Date: 30-Jun-2021 Actual Mid-Term Review Date: Original Closing Date: 30-Jun-2023 Revised Closing Date: 30-Jun-2023 pdoTable Project Development Objectives Project Development Objective (from Project Appraisal Document) The Project Development Objective (PDO) is to support progress towards increased access to basic digital financial and government services targeting entrepreneurship and employment, particularly for women. Has the Project Development Objective been changed since Board Approval of the Project Objective? No Components Table Name Strengthening Institutions:(Cost $7000000.00 M) Enabling Financial and Digital Services:(Cost $20000000.00 M) Project Management and Coordination:(Cost $4000000.00 M) Overall Ratings Name Previous Rating Current Rating Progress towards achievement of PDO Satisfactory Satisfactory Overall Implementation Progress (IP) Satisfactory Satisfactory Overall Risk Rating High High Implementation Status and Key Decisions The Project development objective is to support progress toward increased access to basic digital financial and government services targeting entrepreneurship and employment, particularly for women. The project became effective on August 8, 2019, and is making a good implementation progress. The project has three components, which are summarized below. At the core of the project is the establishment of two specialized Somali entities. The first entity will administer a digital ID system and the second will be an apex MSME Financing Facility to manage a line of credit that the project will make available to eligible financial institutions. 12/17/2019 Page 1 of 9 The World Bank Implementation Status & Results Report Somalia Capacity Advancement, Livelihoods and Entrepreneurship, through Digital Uplift Project (SCALED-UP) (P168115) Component 1: Strengthening Institutions (US$7 million equivalent). This component is focused on stabilizing core government functions enabling access to services for individuals and businesses. This is a reform area requiring progress across multiple ministries, departments, and agencies (MDAs) in several areas. This is intended to strengthen governance and institutional effectiveness. The key areas covered by this component are as follows: i) support to the Central Bank of Somalia (CBS) on improving financial institutions regulations and supervision, promoting efficient financial intermediation and strengthening policies and strategies for digital financial services and expanding financial access; ii) support to the Financial Reporting Center (FRC) on enhancing its understanding of Somalia’s AML/CFT risks, analyzing financial intelligence, and disseminating reports to law enforcement agencies (LEAs) as appropriate; (c) support to the Ministry of Posts, Telecommunications, and Technology (MPTT)/National Communications Authority (NCA) to strengthen policy development and effective regulation of the ICT sector; and (d) support to the Ministry of Interior and Federal Affairs and Reconciliation (MoIFAR) to create the legislative and institutional enabling environment for the digital ID system, including the setup and operationalization of a new dedicated ID Authority. Component 2: Enabling Financial and Digital Services (US$20 million equivalent). This component focuses on increasing individuals’ and businesses’ access to services that expand economic opportunities and help restore resilience in a gender-sensitive manner. Under this component, the project will support sustainable mechanisms for service delivery. In addition, the project will encourage a gender-sensitive approach to the delivery of targeted services and promote the development of gender-sensitive sector policies and strategies to help address the gender gaps identified. Areas covered by the component are as follows: i) setting up the MSME Financing Facility as a dedicated apex institution providing financing to bank and nonbank financial institutions; ii) Digital ID enrollment for at least the first one million registrants, including dedicated support for outreach to the poorer and marginalized groups, and support for the use of the digital ID for increased financial access through more accurate identity verification and authentication mechanisms available to, among others, mobile money companies, banks, and MTBs; ii) Government digital payments, construction of interoperable retail payments services, and integrated Government digital services; iii) e-business registration services for SMEs through operationalization of one-stop shop (OSS), Component 3: Project Management and Coordination (US$4 million equivalent). The component will fund project management and coordination activities. The project will be implemented by the FGS using a single Project Implementation Unit (PIU) anchored in the Ministry of Finance (MoF) in Mogadishu, with a multilayer implementation and oversight structure. The PIU will be responsible for day-to-day project management and will coordinate closely with MDAs covering the project target areas. The PIU will also coordinate activities across the FGS including Federal Member States (FMS). Risks Systematic Operations Risk-rating Tool Risk Category Rating at Approval Previous Rating Current Rating Political and Governance High High High Macroeconomic High High High Sector Strategies and Policies Moderate Moderate Moderate Technical Design of Project or Program Substantial Substantial Substantial Institutional Capacity for Implementation and Sustainability High High High Fiduciary High High High Environment and Social Substantial Substantial Substantial Stakeholders Substantial Substantial Substantial Other -- -- -- Overall High High High Results 12/17/2019 Page 2 of 9 The World Bank Implementation Status & Results Report Somalia Capacity Advancement, Livelihoods and Entrepreneurship, through Digital Uplift Project (SCALED-UP) (P168115) PDO Indicators by Objectives / Outcomes • Number of people who have received their unique ID number, of which (%) are female IN00752346 ►• Number of people who have received their unique ID number (Number, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 0.00 0.00 1,000,000.00 Date 30-Nov-2018 22-May-2019 14-Nov-2019 30-Jun-2023 Comments: • Number of people who have received their unique ID number or ID card IN00752351 Of which (%) are female (Percentage, Custom Supplement) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 0.00 0.00 50.00 Number of people accessing financial services using their digital ID IN00752255 ►Number of people accessing financial services using their digital ID (Number, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 0.00 0.00 900,000.00 Date 31-Oct-2018 22-May-2019 14-Nov-2019 30-Jun-2023 Comments: Total number of people accessing financial services, including transaction accounts, using their digital ID. IN00752350 of which % are female (Percentage, Custom Supplement) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 0.00 0.00 45.00 Number of firms that benefit from reformed business registration requirements IN00752347 ►Number of firms that benefit from reformed business registration requirements (Number, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 0.00 0.00 1,500.00 Date 31-Oct-2018 22-May-2019 14-Nov-2019 30-Jun-2023 Comments: Total number of businesses registered with the e-registration services at MOCI IN00752352 of which % are female (Percentage, Custom Supplement) Baseline Actual (Previous) Actual (Current) End Target 12/17/2019 Page 3 of 9 The World Bank Implementation Status & Results Report Somalia Capacity Advancement, Livelihoods and Entrepreneurship, through Digital Uplift Project (SCALED-UP) (P168115) Value 0.00 0.00 0.00 30.00 Value of MSME loans outstanding from MSME Financing Facility (USD) IN00752348 ►Value of MSME loans from the MSME Financing Facility (USD) (Amount(USD), Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 0.00 0.00 16,200,000.00 Date 30-Nov-2018 22-May-2019 14-Nov-2019 30-Jun-2023 Value of MSME loans (cumulative) from the MSME Financing Facility. Includes re-flows from microloans Comments: window. IN00752353 Of which % are female owned (Percentage, Custom Supplement) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 0.00 0.00 30.00 Jobs created by firms that access the MSME Financing Facility IN00752349 ►Jobs created by firms that access the MSME Financing Facility (Number, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 0.00 0.00 1,400.00 Date 30-Nov-2018 22-May-2019 14-Nov-2019 30-Jun-2022 Cumulative number of jobs created, assuming 6 jobs per SME. Definition for sustainable jobs included in Comments: the PAD. IN00752354 Of which % are for females (Percentage, Custom Supplement) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 0.00 0.00 30.00 IN00752355 Of which % sustainable jobs (Percentage, Custom Supplement) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 0.00 0.00 30.00 Intermediate Results Indicators by Components Component 1 IN00752356 ►Digital ID Authority established & operational (Yes/No, Custom) Baseline Actual (Previous) Actual (Current) End Target 12/17/2019 Page 4 of 9 The World Bank Implementation Status & Results Report Somalia Capacity Advancement, Livelihoods and Entrepreneurship, through Digital Uplift Project (SCALED-UP) (P168115) Value No No No Yes Date 30-Jan-2019 22-May-2019 14-Nov-2019 30-Jun-2023 Legal framework governing the implementation of the digital ID body/system is passed by Parliament, Comments: assented to by the President, and effective. IN00752358 ►Semi-annual reports produced by NCA on a number of license applications processed for communications service providers (Yes/No, Custom) Baseline Actual (Previous) Actual (Current) End Target Value No No No Yes Date 30-Jan-2019 22-May-2019 14-Nov-2019 30-Jun-2023 Semi-annual reports produced by NCA on number of license applications processed for communications Comments: service operator (including ISPs, MNOs, broadcasting service providers). IN00752360 ►FRC publishes quarterly statistics in their website on STRs received and reports disseminated to LEAs (Yes/No, Custom) Baseline Actual (Previous) Actual (Current) End Target Value No No Yes Yes Date 30-Jan-2019 22-May-2019 14-Nov-2019 30-Jun-2023 FRC publishes quarterly statistics in their website on Suspicious transaction reports (STRs) received and Comments: reports disseminated to law enforcement agencies (LEAs). IN00752362 ►Semi-annual reports produced by CBS on number of financial institution examinations and cases of supervisory actions using regulatory technology solution. (Yes/No, Custom) Baseline Actual (Previous) Actual (Current) End Target Value No No No Yes Date 30-Nov-2018 22-May-2019 14-Nov-2019 30-Jun-2023 Semi-annual reports produced by CBS on number of financial institution examinations and cases of Comments: supervisory actions using regulatory technology solution. IN00752364 ►Inter-agency coordination body established for coordination between CBS, FRC, and NCA, under an MOU (Yes/No, Custom) Baseline Actual (Previous) Actual (Current) End Target Value No No No Yes Date 30-Nov-2018 22-May-2019 14-Nov-2019 30-Jun-2023 Inter-agency coordination body established for coordination between CBS, FRC, and NCA, under an MOU Comments: covering policy formation and harmonization of policies. IN00752366 ►Financial sustainability plans prepared and submitted to MoF by each of the project supported institutions (Yes/No, Custom) Baseline Actual (Previous) Actual (Current) End Target Value No No No Yes Date 30-Jan-2019 22-May-2019 14-Nov-2019 30-Jun-2023 12/17/2019 Page 5 of 9 The World Bank Implementation Status & Results Report Somalia Capacity Advancement, Livelihoods and Entrepreneurship, through Digital Uplift Project (SCALED-UP) (P168115) Financial sustainability plans prepared by each of the project supported institutions (CBS, FRC, MPTT/NCA, MoIFAR/new ID Authority) and submitted to MoF.The sustainability plan will assist the Comments: concerned agency and MoF with comprehensive fiscal planning for the long-term management of the assets associated with the project, including foreseen reinvestment when improvements are past their useful life or in need of routine replacement and/or maintenance. Component 2 IN00752357 ►Total number of MSME loans outstanding from the MSME Financing Facility (Number, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 0.00 0.00 3,130.00 Date 30-Nov-2018 22-May-2019 14-Nov-2019 30-Jun-2023 Total number of SME and Micro loans that are financed by MSME Financing Facility via the PFIs Comments: (cumulative). IN00752359 Of which (%) are Micro loans (Percentage, Custom Supplement) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 0.00 0.00 90.00 IN00752361 ►Target quotas for lending to women introduced by the PFIs of the MSME Financing Facility (Yes/No, Custom) Baseline Actual (Previous) Actual (Current) End Target Value No No No Yes Date 31-Jan-2019 22-May-2019 14-Nov-2019 30-Jun-2023 PFIs of the MSME Financing Facility will introduce target quotas for women to increase women’s access Comments: to finance. IN00752363 ►Percentage of MSME beneficiaries that are satisfied with PFI lending processes (Percentage, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 0.00 0.00 85.00 Date 30-Nov-2018 22-May-2019 14-Nov-2019 30-Jun-2023 These indicators capture MSME satisfaction with quality of on-lending processes and services provided by Comments: PFIs. IN00752365 % of female owned MSMEs that are satisfied with services provided by PFIs. (Percentage, Custom Supplement) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 0.00 0.00 90.00 IN00752367 ►Additional private capital mobilized by PFIs (USD) (Amount(USD), Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 0.00 0.00 8,000,000.00 12/17/2019 Page 6 of 9 The World Bank Implementation Status & Results Report Somalia Capacity Advancement, Livelihoods and Entrepreneurship, through Digital Uplift Project (SCALED-UP) (P168115) Date 30-Nov-2018 22-May-2019 14-Nov-2019 30-Jun-2023 This indicator captures how the MSME Financing Facility incentivizes PFIs to voluntarily strengthen their Comments: capital position, as the terms of agreement for PFIs to access funds includes a clause that borrowing from the MSME Financing Facility cannot exceed 20% of current capital. IN00752368 ►Percent of FGS payments that are executed via interoperable inter-bank payment mechanism rather than cash. (Percentage, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 0.00 0.00 100.00 Date 30-Nov-2018 22-May-2019 14-Nov-2019 30-Jun-2023 This indicator captures the change in the use of cash as settlement instrument towards interoperable Comments: inter-bank payment mechanism. IN00752369 ►Percent of Somali citizens satisfied with quality of service on digital ID enrollment (Percentage, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 0.00 0.00 85.00 Date 30-Nov-2018 22-May-2019 14-Nov-2019 30-Jun-2023 This indicator will be captured through a survey which measures satisfaction on planning and enrollment Comments: process of digital ID IN00752370 ►Percentage of Non-Performing Loans among PFIs (Percentage, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 25.00 0.00 0.00 10.00 Date 01-Dec-2018 22-May-2019 14-Nov-2019 30-Jun-2023 The asset quality of PFIs verified through the sum of impaired assets and those past due items that are Comments: overdue 90 days or more IN00752371 ►Percentage of grievances for the MSME Financing Facility addressed by the Project (Percentage, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 0.00 0.00 100.00 Date 01-Feb-2019 22-May-2019 14-Nov-2019 30-Jun-2023 Percentage of grievances received through GRM for the MSME Financing Facility addressed by the Comments: Project Data on Financial Performance Disbursements (by loan) 12/17/2019 Page 7 of 9 The World Bank Implementation Status & Results Report Somalia Capacity Advancement, Livelihoods and Entrepreneurship, through Digital Uplift Project (SCALED-UP) (P168115) Project Loan/Credit/TF Status Currency Original Revised Cancelled Disbursed Undisbursed % Disbursed P168115 IDA-D4330 Effective USD 18.00 18.00 0.00 0.50 17.22 2.8% P168115 TF-A9642 Effective USD 13.00 13.00 0.00 0.50 12.50 3.8% Key Dates (by loan) Project Loan/Credit/TF Status Approval Date Signing Date Effectiveness Date Orig. Closing Date Rev. Closing Date P168115 IDA-D4330 Effective 07-Mar-2019 10-Apr-2019 08-Aug-2019 30-Jun-2023 30-Jun-2023 P168115 TF-A9642 Effective 07-Mar-2019 10-Apr-2019 08-Aug-2019 30-Jun-2023 30-Jun-2023 Cumulative Disbursements Restructuring History There has been no restructuring to date. Related Project(s) There are no related projects. 12/17/2019 Page 8 of 9 The World Bank Implementation Status & Results Report Somalia Capacity Advancement, Livelihoods and Entrepreneurship, through Digital Uplift Project (SCALED-UP) (P168115) 12/17/2019 Page 9 of 9