Consultant: Development of a Regulatory and Supervision Framework for FinTech in Mozambique

1. THE ALLIANCE FOR FINANCIAL INCLUSION & BANCO DE MOÇAMBIQUE:

The Alliance for Financial Inclusion (AFI) is a unique international network of central banks, ministries of finance and economy, and other regulatory bodies which hold the mandate to develop and implement financial inclusion policies. Our aim is to do so through our mission of empowering financial regulators and policymakers to increase access and usage to quality financial services for the most underserved and unserved populations.

Following the approval by the Government of Mozambique in 2016, of the National Financial Inclusion Strategy (NFIS) for the period 2016-2022, coordinated by the Banco de Moçambique (central bank of Mozambique), with the objectives to increase the level of financial inclusion in the country via three key pillars, namely; (i) Access and Use of Financial Services, (ii) Strengthening Financial Infrastructure, and (iii) Consumer Protection and Financial Literacy, a mid-term review of the NFIS was undertaken in July 2019, with recommendations to further improve and accelerate the delivery of the financial inclusion targets.

One of the key resolutions adopted from the recommendations from the mid-term review was the development of an inclusive regulatory and supervision frameworks for FinTechs through a consultative and collaborative approach with various stakeholders in Mozambique, with the aim of increasing access and usage of financial services among unserved and underserved population, women, and youth.

In line with the AFI network ethos of providing technical and resource support to members towards achieving and/or improving on their financial inclusion targets, this consultancy brief sets out the requirements for the engagement of a consultant to support Banco de Moçambique (BoM) with the development of a Regulatory and Supervision Framework for Fintech.

2. Overall Objective:

The deliverable is the development of a robust, gender sensitive and actionable Regulatory and Supervision Framework for FinTech for the Banco de Moçambique. The final deliverable is expected to reflect and align to the following:

• Targets and objectives as set out in the NFIS,
• All existing legal, regulatory and policy position of Mozambique and the central bank,
• The context and market situation of Mozambique evident by the contribution and alignment with various relevant stakeholders in the country, including but not limited to, other regulators and government agencies, banking sector, mobile money operators, payment network operators, insurance providers, development partners Mozambique Association of FinTechs (FinTechMz) and any other relevant stakeholders,
• Compliment and support other innovative regulatory approaches such as the FinTech Sandbox and other initiatives contributing to the development of the FinTech ecosystem.
• 1. Scope of Work:
• The consultant (or consulting firm) is expected to present a final draft of the framework which should articulate clear regulatory, supervisory and oversight principles for the participation, actions, operations and support of FinTechs in the financial services ecosystem in Mozambique.
• The following sets out the scope of work and expected deliverable under this brief:
• · Inception meeting – preliminary consultations with the BoM team and AFI technical team to agree on the scope, expected deliverables, support, reporting and related timelines.
• FinTech Landscape Diagnosis: Conduct extensive As-Is Assessment of the Mozambique Fintech landscape, research on standards, industry trends, models and best practices in regulatory and supervision frameworks for FinTechs and aligning the best practices from this to fit the context of Mozambique and the expectation of BoM. BoM shall support consultant with necessary industry documentations and relevant existing regulations, industry data etc.
• Develop Outline for the Regulatory and Supervision Framework for FinTech: Drawing insights from extensive literature reviews of regulatory frameworks for supervision and oversight across the globe, insights from the diagnosis and literature review, the consultant shall develop the outline of the framework, highlighting key components, principles and consideration.
• Stakeholder Engagement Workshop/Webinar: The consultant shall be the lead resource person for the workshop (held either physically or virtually). The consultant shall lead with the planning, agenda setting, briefing, coordination and hosting of the workshop with the objective to facilitate discussions with broad and relevant stakeholders, solicit suggestions and inputs and identify broad outlines and scope of the framework.
• Interview Stakeholders: In consultation and support from BoM and AFI, conduct interviews (remotely) with selected relevant stakeholders in Mozambique and beyond.
• Develop Draft Regulatory and Supervision Framework for FinTech: Based on the approved outline of the framework, inputs received from stakeholder engagement and insights from diagnosis and research, the consultant shall develop the first draft of the framework which shall include details, principles, considerations and procedures for the supervision of FinTechs for submission to BoM and AFI for reviews and inputs.
• Comprehensive & Technical Review and Dissemination of Exposure Draft Framework: The consultant shall support and lead the review process with all relevant and identified stakeholders by coordinating and compiling all feedbacks, inputs, comments, and remarks into a matrix for onward evaluation and finalization. The review process shall also include a peer review process within the AFI network, coordinated with the support of AFI, the consultant shall coordinate and collate feedbacks received and facilitate onwards evaluation of feedback for finalization.
• Finalize Deliverable: Based on inputs from the AFI Management Unit, BoM team and select stakeholders, consultant shall finalize the framework based on endorsement by BoM.
• Capacity Building Workshop: The consultant shall be the lead resource person for this workshop. The consultant shall be responsible for the planning, agenda setting, training and instructional content, speaker(s) engagement, coordinating and hosting of the workshop (which can be held either physically or virtually) for BoM internal stakeholders and staff on the regulation and supervision of FinTech based on the Regulatory and Supervision Framework for FinTech. This shall serve as a dissemination and training event and will be supported by BoM and AFI.
• Launch Plan for FinTech Framework: Develop presentation and other communication of the framework towards the launch and dissemination to various stakeholder groups across different communication channels.

Note: The actual implementation of the framework is out of scope for this project.

4. Timelines:

The scope and tentative timelines for this assignment is detailed below:

1. Appointment of Consultant -Signed Agreement with Consultant: 9^th November 2020
2. Inception Meeting – Introduction to team and discussion on brief: 12^th November 2020
3. Landscape Diagnosis & Desk Research – Summary of findings and inputs into framework outline: 12^th – 27^th November 2020
4. Develop Outline for the Regulatory and Supervision Framework for FinTech – Approved Outline for the Regulatory and Supervision Framework for FinTechs: 2^nd December 2020
5. Stakeholder Engagement Workshop (Physical / Virtual) – Report on Workshop and Stakeholder Engagement: 8^th December 2020
6. Interview Stakeholders – Minutes and reports on interviews with identified stakeholders: 9^th – 21^st December 2020
7. Develop Draft Regulatory and Supervision Framework for FinTech – First draft Regulatory and Supervision Framework for FinTech for Mozambique: 11^th January 2021
8. Comprehensive & Technical Review / Dissemination of Exposure Draft Framework – Develop matrix and collection of feedback, inputs and comments for evaluation and finalization: Week 3 January till 26^th February 2021
9. Peer Review of draft Framework within the AFI Network: March 2021
10. Finalise Regulatory and Supervision Framework for FinTech for Mozambique – Submit final draft of Regulatory and Supervision Framework for FinTech for Mozambique: April 15^th 2021
11. Capacity Building workshop for BoM on the Regulation and Supervision of FinTechs – Workshop Report indicating learning objectives is achieved by BoM staff: May 13^th 2021
12. Launch Plan for FinTech Framework – Develop PowerPoint presentation and other communication articles, blogs towards the launch and dissemination of the framework: May 21^st 2021
13. End of Consultancy: May 28^th 2021

During the assignment, the BoM team and AFI MU will closely support the consultant by: sharing internal expertise and existing research; contacting or connecting key stakeholders to assist in arranging the consultant’s communications and telephone interviews; and providing inputs to deliverables. This assignment is expected to involve extensive desk research and interaction with key stakeholders.

5. Travel:

Subject to local health guidance regarding COVID-19, for consultant domiciled in Mozambique, local travel is expected.

6. Consultant Experience:

• Advanced university degree in social science, international economics, development finance or other related field.
• 8+ years of professional experience in broad financial regulatory and policy interventions, digital financial services and financial technology, financial regulation for DFS and Fintech, and AML-CFT, public policy, financial inclusion and international development.
• Global knowledge of policy and regulatory framework development on regulation, supervision, and oversight of non-bank financial services providers, FinTechs and e-money issuers, payment service providers etc. Knowledge specific to the African region is an added advantage.
• Previous experience working in sub-Sahara Africa on issues related to digital financial inclusion, fintech with policymaking and regulatory institutions is desirable.
• Sophisticated understanding and experience in analyzing the issue of regulatory oversight and supervision around financial inclusion, stability, integrity, and consumer protection through the lens of growing digital technology.
• Experience working directly with central banks on policy development and implementation, preferably in regulatory oversight, supervision, reporting and enforcing policies and mandates.
• Excellent written and presentation skills in the English language. Knowledge and proficiency in Portuguese will be an added advantage.

7. Reporting:

Throughout the contract period, the consultant will be reporting to the Project Lead from the Banco de Moçambique and the Policy Specialist for FinTech from AFI.

8. Criteria for Evaluation:

The proposals submitted will be evaluated based on the following criteria:

Technical Scoring – 100%

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1. Academic Qualification; 10%

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2. Experience and competence of the key staff for the assignment related; 50%**

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• Adequacy for the assignment – 25%

• Regional/Global experience – 25%

3. Adequacy of the proposed work plan and methodology in responding to the Terms of Reference; 20%

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• Technical approach and Methodology – 10%

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• Workplan – 10%

4. Sample work – Writing experience and English; 20%