Activity Design

Activity design is the process by which USAID defines how it will implement an activity contributing to a project. An activity can be an implementing mechanism such as a contract, direct agreement with the partner country government, cooperative agreement, or grant. It also refers to actions undertaken directly by USAID staff, such as policy dialogue or capacity development. 

Conceptual Framework 

USAID does not have a specific framework for digital financial services. The USAID Digital Ecosystem Framework—the core of the Digital Ecosystem Country Assessment—has a Digital Economy pillar that contains a section on digital financial services. For further information, the DECA Research Checklist Ideal State (see page 36) provides a helpful description of the framework. 

The United Nations Capital Development Fund (UNCDF) has a framework based on market development stages—that is, how developed the digital environment is—and recommendations for activities suited to that stage. The current index does not include many countries; however, they are actively expanding coverage. Additionally, the next resource box below has well-regarded frameworks from other organizations. 

Resources and toolkits to design a new, standalone award 

(These are overviews of the sector; USAID specific procurement examples including scopes of work are given below in a separate section)

1. New Funder Guidelines: Market Systems Approach to Financial Inclusion (2015) 

   • These guidelines are intended to provide guidance for funders promoting financial inclusion or pro-poor financial services markets as part of their development mandate. 

2. Digital Financial Services (2020) 

   • This report provides an overview of the role of DFS in alleviating constraints to financial access in emerging and developing economies, as well as insights into establishing necessary DFS regulatory and infrastructure systems. The report also explores select country-specific approaches and lessons learned for DFS. 

3. The UN Principles for Responsible Digital Payments (2021) 

   • This report articulates how digital payments might better serve their users and become truly responsible. The Principles advocate for responsible practices in the digitization of payments and are not intended to provide a technical analysis of what each Principle means in practice. 

4. Incorporating Gender-intelligent Design in Financial Services (2022)

   • This guide brings together a wide scope of resources that address gender-intelligent design: research, case studies, toolkits, and best practice guidelines. It is structured to allow users to easily mine the most relevant resources on gender intelligent design in women’s financial inclusion. 

Toolkits for specific challenges

1. Building Faster Better: A guide to inclusive instant payments systems (2021)

   • This technical guide describes how to build an instant payment system that is interoperable and facilitates the type of small dollar, mobile payments often used by low-income customers. It details key components of a system—oversight, scheme, switch, and settlement—and explains the basic steps to achieving interoperability. Along the way, it highlights examples of how various countries have approached these challenges.

2. Interoperability and Digital Finance: Emerging guidance for funders (2021)

   • This technical note explains how funders can support instant payments systems that are interoperable and facilitate the type of small-dollar, mobile payments often made by low-income customers. It helps funders to understand the concept of interoperability, how instant payments systems can advance financial inclusion, and what funders can do to support their development. It builds on the more detailed CGAP Technical Guide, “Building Faster Better: A Guide to Inclusive Instant Payment Systems.”

3. Elevating the Collective Consumer Voice in Financial Regulation (2021)

   • This paper explores the potential impact of incorporating the collective voice of consumers into financial sector policy and regulation, and opportunities for funders to help elevate these voices.

4. How Regulators Use Sex-Disaggregated Data and Reg-tech to Enhance Financial Inclusion (2021)

   • This study examines how regulators are using, or could use, sex-disaggregated data to enhance women’s access to and use of financial products and services. The study also explores how new technologies could help foster financial inclusion.

5. Gender Diversity & Leadership Development in Financial Services

   • This guide brings together a selection of the most relevant practical resources, tools, and proven solutions to increasing gender diversity in the financial services industry leadership and workforce organized into the following categories: Leadership, Workforce Development, Diversity and Representation, Institutional Gender Gap Assessment and Training.

6.  Improving the Use of Digital Payments in Humanitarian Response (2018)

   • This guide provides an overview of how digital payments and digital financial services can deliver better cash and voucher assistance in humanitarian response.

7. Financial Service Provider Assessment tool that includes links to USAID NetHope E-payment tool kit , Mercy Corp E-Transfer Implementation Guide and more for cash and voucher assistance in humanitarian assistance

   • This assessment tool is part of a broader Programme Quality Toolkit that covers the entire program cycle from situation analysis, program design, implementation, monitoring and evaluation; and is broader in scope than just digital. 

8. Digital Cash Transfers: Expanding the Effectiveness of Nutrition Activities Through Digital Tools in Bangladesh (2020) and Boosting Nutrition in Cambodia with Digital Cash Transfers (2020) 

   • These project briefs provide snapshots of how to expand the effectiveness of nutrition activities through digital tools. 

9. ECommerce Marketplaces for Agriculture (2021)

   • This brief report provides an overview of the benefits and risks of e-commerce marketplaces for agriculture. 

10. Expanding Mobile Phone Access and Ownership (2021)

    • This brief report provides insights into various approaches that can be used to expand mobile phone access and ownership. 

11. Technology Inequality: Opportunities and Challenges for Mobile Financial Services

    • This report offers a primer on the technology that enables digital financial services to operate on different types of cell phones—basic, feature, and smartphones—and reminds us to not exclude potential users by making assumptions about their access to technology.

12. USAID Connectivity Data Tool

    • This is a framework for assessing the commercial opportunity and social impact of mobile and internet connectivity (beyond just payments).

13. Better Connectivity, Better Programs: How to Implement a Demand Aggregation Program

    • This How-to Guide enables USAID personnel to understand and document the cost of internet and mobile services for USAID activities and determine where connectivity coverage gaps and affordability gaps exist. 

Managing Risk

The first resource is a slide deck recommended for all staff. While we may not have an activity implementing digital financial payments, USAID staff should be aware of the evolving digital context and how it is impacting our clients—and be an advocate for inclusion, respect for privacy, cybersecurity and consumer protections.

1. The Evolution of the Nature and Scale of DFS Consumer Risks: A Review of Evidence slide deck (2022) webinar

   • This presentation outlines risks and proactive measures that stakeholders can take to mitigate them.

2. Is It Possible to Estimate Financial Stress Before It Harms Borrowers? (2021)

   • This blog offers a discussion of credit burden and how to create a financial stress early warning system.

3. Algorithm Bias in Credit Scoring: What’s Inside the Black Box? (2019)

   • This article summarizes how the growing use of algorithms opens up opportunities but also the possibility for unfair bias and discrimination.

4. It’s Time to Change the Equation on Consumer Protection (2019)

   • This blog presents a discussion of a customer-outcomes approach to digital financial services that will empower consumers and increase services.

5. Market Monitoring for Financial Inclusion: toolkit (2022)

   • This toolkit shows that market monitoring is a supervisory activity and takes a broad look at an industry, sector, or market (e.g., the credit market) as opposed to focusing on individual financial services providers (FSPs). This toolkit and case studies are written for market monitors themselves.

Procurement document examples

1. Philippines E-PESO RFP (2014)

   • This program’s objective is to accelerate the shift to digital payment, by (1) driving transaction volume of large payment streams; (2) promoting retail and market-level infrastructure; (3) improving the enabling environment for e- payments including policies that will promote consumer protection and security measures; and (4) addressing gaps in the broader e-payment ecosystem.

2. Philippines SPEED SOO (2021) [follow on to E-PESO]

   • This activity's primary goal is to provide technical advisory services and commodities support to enable greater participation of Philippine small and medium enterprises (SME) in the digital economy. To expand the participation of the SME sector, this activity will: (1) improve SME capacity and access to e-commerce platforms; (2) expand and increase the use of e-payment systems and other FinTech innovations; (3) improve the integration of e-commerce platforms with logistical supply chains; and (4) increase consumer awareness and protections.

3. Colombia Equitable and Resilient Finance RFI (2021)

   • This activity has a dedicated Intermediate Result (IR) to “increased provision of digital services by financial service providers” with suggestions for illustrative activities around (1) incentivizing new digital solutions and inclusive digital finance products; (2) working with FinTech and financial service providers; and (3) improving financial service providers’ readiness to manage and mitigate cyber security risks. 

4. RDMA Digital Connectivity and Cybersecurity (2021) 

   • Through this regional activity, USAID aims to foster an open, interoperable, reliable, and secure digital ecosystem in the Pacific Islands by (1) improving broadband access; (2) strengthening digital policy and regulations; (3) advancing digital platforms and solutions for the delivery of public services; and (4) upgrading of digital skills and literacy.

5. Washington, Digital Invest: Mobilizing Private Capital for Internet Connectivity and Digital Financial Services in Emerging Markets (2022) See Addendum “Digital Invest 2022…”, pp. 7-9

   • This opportunity is for a Washington Global Development Alliance (GDA) Annual Program Statement (APS) Addendum to finance innovative digital financial services.

6. Addressing Sustainability in Alternative Development Value Chains in Peru (2022)

   • This is a larger agriculture award that references digital in a subtle way.

7. Digital Connectivity and Cybersecurity Partnership (DCCP) - Pacific (2022) see J.1

   • This is an example of an opportunity that integrates digital financial services into a much larger connectivity/digital award

Assessment examples

1. Digital Financial Services in Rural Areas of Colombia (2019)

   • This document incorporates findings from a  series of studies that seek to determine the characteristics, conditions, and financial habits of the inhabitants of Colombia´s rural areas; and to study the financial products and services, and determine their money management behaviors and habits and their relationship with the digital transactional channels that are available today.

2. Digital Solutions for Agriculture Market Systems Responding to COVID-19 (2021)

   • In an effort to support market system actors as they navigate the challenges and opportunities of digital transformation in the age of COVID-19, USAID’s Bureau for Resilience and Food Security commissioned a rapid analysis that focused on three key objectives: (1) identify and analyze trends driving the adoption of digital tools in agriculture market systems in response to the global pandemic; (2) provide examples of such digital solutions across market system actors; and (3) provide concrete and actionable recommendations for USAID Missions and implementing partners to ensure that digital tools can be used effectively to increase resilience in the face of future threats.

3. Digital Agriculture Ecosystem Assessments: Bangladesh,Burkina Faso,  Honduras, Haiti, Malawi, Niger, Nepal, Uganda, Tajikistan - Click on middle tab “Resources” in middle of page

   • This series of assessments were conducted in coordination with various USAID Missions to help each to better understand, work with, and support digital agriculture ecosystems to their respective development objectives. 

4. India Digital Financial Inclusion: Journey Map Report (2019)

   • This report highlights major trends and drivers in digital finance, key actors, and roles played, and also presents a roadmap for the next phase of digital financial inclusion in India.

5. Assessment of Potential Opportunities for Use of Digital Payments for Smallholder Farmers in Northern and Central Senegal (2020)

   • This assessment explores the role that DFS can play in the financial inclusion of smallholder farmers in Senegal. It also summarizes key findings, and proposes recommendations and stakeholders who could implement them.

6. Assessment of Potential Opportunities for Use of Digital Payments for Smallholder Farmers in Guatemala’s Western Highlands (2020)

   • This assessment explores the role that DFS can play in the financial inclusion of smallholder farmers in Guatemala. It also summarizes key findings, and proposes recommendations and stakeholders who could implement them.

7. Assessment of the Gender Gap in Access to Digital Financial Services in Burkina Faso (2020)

   • This assessment explores the role that DFS can play in making female entrepreneurs more resilient and suggests conditions that permit greater DFS access and use among women.

8. Exploring the Use of Mobile Money Services among Tea SACCOs in Rwanda (2021)

   • This report explores the challenges and opportunities that emerged from automation as well as potential spillovers of transitioning agricultural cooperatives to a mobile money payment system.