Afghanistan: Moving police salary payments to mobile accounts

This story is authored by the Treasury General Directorate at the Ministry of Finance of the Government of Afghanistan. The article was originally published on the Treasury website.

© ©Government of Afghanistan Ministry of Finance/Treasurywebsite

photo credit: Government of Afghanistan Ministry of Finance/Treasury website

Afghanistan has over 800,000 government employees working in civilian and military sectors. Since 2003 more than 73% of government employees are receiving their salary through bank accounts. Yet, 27% of government employees are getting paid cash in remote areas which is not a transparent mechanism and creates ghost employees due to weak verification process.

Based on the continued efforts of the Treasury General Directorate, the banks have been able to integrate their systems with communication companies and provide their customers with access to their salary accounts by using mobile banking facility, which is particularly helpful in areas that do not have access to bank branches.

© ©Government of Afghanistan Ministry of Finance/Treasurywebsite

photo credit: Government of Afghanistan Ministry of Finance/Treasury website

The Pilot project of mobile banking started in Kapisa province in north of Kabul in July 2015 and the first payment of salary to Afghan Local Police (ALP) through mobile happened in August 2015. The salary payment made two days before Eidul Adha and it surprised the policemen for receiving their monthly pay for first time in full amount. They thought there was a bonus payment included in their salaries!

The new payment mechanism was greatly appreciated by Afghan Local Police leadership and the funding donor, Combined Security Transition Command Afghanistan (CSTC-A), since the process helps in removing ghost employees and strictly limits the payment of salary to a second party by capturing the employees finger print into the system.

It was a successful attempt. Treasury department expanded the process in other provinces of the country where bank branches are not available. Currently the mobile banking is implemented in 7 Provinces and registration is ongoing in another 3 provinces.

The Ministry of Finance uses this new method for paying salaries of national police and local police in the far reaching districts where no bank branches are available. The objective now is to enroll significant number of teachers, national police and local police within the mobile banking facility.

Through access of personal funds in bank accounts by mobile phones, the customers will benefit the services such as, increasing credit card, payment of electricity bill, payment of purchasing bills and receiving cash from telecommunication companies’ branches. Lessons learned in implementing mobile banking platform are being used for expanding to other areas. However, for this initiative to achieve substantial reach and acceptance, parallel efforts have to be made for inclusion of ancillary providers like grocery shops, transport entities, school etc.within the mobile settlement process. Security still poses a major challenge in Afghanistan but these efforts of outreach may also help in alleviating some of the security concerns.

© ©Government of Afghanistan Ministry of Finance/Treasury website

photo credit: Government of Afghanistan Ministry of Finance/Treasury website