DFAT demonstrates priorities with new 'Business Partnerships Platform' funding

CANBERRA — Australia’s Department of Foreign Affairs and Trade will soon be announcing funding for the second round of projects under its Business Partnerships Platform, which aims to accelerate Australia’s collaboration with business. Originally expected to be announced on October 27 with details provided to Devex under embargo, the expected announcement was delayed by DFAT after the embargo date had passed and publication of an article.

The greenlighted projects detailed in the original release highlighted the increasing importance of private sector engagement, innovation, and gender for the Australian aid program.

One project in particular demonstrates these values — a partnership between Sri Lanka-based telecommunication company Dialog and consulting firm Ernst & Young to roll out a digital payment platform across 200 rural villages in Sri Lanka’s Northern Province.

Receiving 500,000 Australian dollars ($383,183) of funding from DFAT on top of a partner contribution of 760,500 Australian dollars to support the pilot phase of the project, Dialog and DFAT spoke to Devex about what made it stand out as a development initiative and the value it provides to a contemporary aid program.

The digital payment platform was submitted as an application for round two BPP funding with a 10-year budget and project plan to roll out an inclusive digital payment platform across 200 rural villages in the Northern Province of Sri Lanka — a region where development has been impacted by a history of armed conflict. The limitation in electronic financial infrastructure for the area has stalled economic growth and resulted in 1.1 million people with limited or no access to financial and digital services, according to DFAT.

The partnership between Dialog and EY aims to bring mobile money, ATMs, and point of sale terminals to provide access to savings accounts, loans, and payment systems to the region.

The project specifically aims to encourage female retailers to adopt digital terminals and receive commission from this service — building a network of women entrepreneurs, increasing income, and boosting their financial capability.

Achieving development outcomes through partnerships

The focus on business partnerships as part of this DFAT funding initiative requires roles and responsibilities of partners to be clearly defined to support development outcomes.

Dialog will be focused on the implementation side, bringing digital and technical expertise to the table.

“The existing Dialog mobile money team will ensure the delivery of this project, with the support of a steering committee chaired by the head of digital services business unit,” Ravin de Mel, chief manager for group corporate planning and strategy at Dialog, explained to Devex. The project governance committee will also monitor risks and ensure proactive risk mitigation activities are undertaken, de Mel said.

After rolling out the project, Dialog’s regional staff in the northern region will be involved in conducting operational activities.

EY’s role in the partnership, meanwhile, will focus in project management, providing expert knowledge and advice on developing the business plan and designing and executing the project. The role of DFAT will also be critical, according to de Mel.

“Partnership with DFAT provides a solid basis foundation for accessing donors,” he said. “DFAT’s extensive support through knowledge on communities, local grassroots organizations, and relationships with the government bodies helps shape our ideas and approach towards targeted projects.”

DFAT intends to be more than just a financial contributor; the aid program has already been instrumental in developing monitoring and evaluation arrangements and establishing learning objectives they hope to achieve.

“From DFAT’s perspective, we are most interested in the impact on women entrepreneurs and on household savings,” Blundell explained. “The involvement of Ernst & Young ensures both DFAT and Dialog have the information we need to measure success and learn from this collaboration.”

And DFAT will be providing support to help achieve successful outcomes — especially for women who will be supported.

“We are not a business competitor and so there is an ease to the relationship,” Charlotte Blundell, counselor of development cooperation at the Australian High Commission in Colombo, told Devex. “It is very open. We will play the part of critical friend, providing support and candid feedback, and sharing our expertise.”

Linking to Australian aid priorities for Sri Lanka

The Australian Aid Investment Plan for Sri Lanka sets three objectives for achievement by 2019: expansion of economic opportunities for the poor; supporting government to be more responsive to the needs of citizens and the private sector; and increasing gender equality.  

“The Dialog project complements work we are already doing with leading firms in Sri Lanka to improve the employment and leadership opportunities for women and to increase female-headed enterprises’ access to investment and inclusion in national and global business supply chains,” Blundell said.

Beyond the 2019 objectives of the aid investment plan, the project may help shape future investments and initiatives for aid programs in the country. Blundell said DFAT will be hoping Dialog or a competitor is able to replicate the model from the project elsewhere to support women and economic development.

“There is the potential to generate an impact many times greater than the original investment,” she said. “In addition, evidence of the project’s impact on women entrepreneurs can feed into our larger bilateral investments.”

Demonstrating the value of empowering women in DFAT’s development initiatives

Following a number of successful projects funded in round one with a focus on gender, DFAT required round two applications to include gender as one of the primary development outcomes of all proposals — a requirement embraced by applicants, according to Arthi Patel, a gender and development consultant supporting the BPP.

“There is a global shift going on with corporations seeing the benefit of a strong social justice,” she told Devex.

The collaboration between Dialog and EY was an example of the emphasis the private sector has placed on gendered development initiatives. The focus is on a region of Sri Lanka where war widows and women-headed households struggle to create opportunities for themselves and their families.

“This partnership will test a new service in a former conflict-affected part of Sri Lanka, where there are numerous female-headed households and low rates of digital content adoption and consumption,” de Mel explained. “Dialog’s initiative will investigate the feasibility of a village-based platform that delivers financial services like payments, remittances, and withdrawals. We believe this could have a transformational impact on existing small businesses, and give more women the opportunity to become part of the Dialog franchise.”

This project is an important initiative for the Australian aid program’s support of women in Sri Lanka, Blundell said. “Women across Sri Lanka tell us that they need employment opportunities close to home, so this project responds to that demand.”

While there are a number of initiatives in Sri Lanka that aim to engage women entrepreneurs, not all are scalable. This project serves as an important test case for future aid delivery with a gendered focus.

In encouraging private sector involvement in development initiatives and aid program, it is important to demonstrate value of these initiatives. And for Blundell, the Dialog and EY partnership has “huge potential” to achieve this.

“If the pilot is successful, then Dialog, and probably other competitors, will look to adapt it more widely,” she said. For Dialog, there are business objectives that can be supported through social initiatives like this project.

“The business idea for Dialog focuses on a market segment which is underserved in terms of access to financial and digital services, and that, if developed, would create viable commercial proposition in the long term,” de Mel said.

The extension and evolution of mobile cash service networks in Sri Lanka’s Northern Province will help Dialog create a “backbone financial infrastructure” to enhance economic activity and prospects of both merchants and consumers, with the expectation it will prompt local cluster development. “The project targeting women creates a self-sufficient household income, thereby empowering them as women retailers,” de Mel said.

While this is Dialog’s first project with BPP, the potential benefits have led to additional projects being developed in the hope they can be proposed for future funding.

Lessons for funding success

This project in particular provides important insights into the needs of the Australian aid program and the partnerships and projects they seek to support, according to Blundell.

“BPP is a mechanism for collaboration, so, in addition to bringing a truly innovative idea that is core to your business, you also need to bring a clear rationale for engagement with DFAT,” Blundell said.

Within Australian aid-supported countries, Blundell said the mandate for aid program managers is to help solve complex development challenges in frontier and emerging markets — and businesses with an in-country footprint that can support this should seek funding opportunities through initiatives such as the BPP.

“If we can leverage each other’s assets and connections to meet Australia’s development objectives and your business objectives, then definitely apply,” Blundell said.

In the meantime, this new Dialog and EY BPP partnership is expected to be publicly launched in Jaffna, Sri Lanka, on November 29, 2017.

Update, October 30, 2017: This piece has been updated to clarify the timing of DFAT's announcement, as well as a quote from Charlotte Blundell.

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