Key Dates. Project Development Objectives. Components. Overall Ratings

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1 Public Disclosure Authorized AFRICA Madagascar Finance, Competitiveness and Innovation Global Practice IBRD/IDA Investment Project Financing FY 2018 Seq No: 1 ARCHIVED on 08-Jun-2018 ISR32759 Implementing Agencies: Ministere des Finances et du Budget, Ministere des Finances et du Budget Public Disclosure Authorized Key Dates Key Project Dates Bank Approval Date:28-Feb-2018 Planned Mid Term Review Date:15-Jul-2020 Original Closing Date:31-Jul-2022 Project Development Objectives Effectiveness Date:-- Actual Mid-Term Review Date:-- Revised Closing Date:31-Jul-2022 Public Disclosure Authorized Project Development Objective (from Project Appraisal Document) The development objective of this project is to promote the financial inclusion of individuals and MSMEs in Madagascar. Has the Project Development Objective been changed since Board Approval of the Project Objective? No PHRPDODEL Components Name Digitalization of transactions to increase usage of transaction accounts:(cost $25.50 M) Access to credit for MSMEs:(Cost $16.50 M) Public Disclosure Authorized Project Management and Impact Evaluation:(Cost $3.00 M) Contingent Emergency Response Overall Ratings Name Previous Rating Current Rating Progress towards achievement of PDO -- Satisfactory Overall Implementation Progress (IP) -- Satisfactory Overall Risk Rating -- Moderate 6/8/2018 Page 1 of 8

2 Implementation Status and Key Decisions The Financial Inclusion Project was approved by the Board on February 27, The Financing Agreement was signed in April 19, 2018.The project will have a 4-year implementation timeline. A Project Preparation Advance and two (2) retroactive Financing were set up respectively in June 2017 and November The retroactive financing funds a first tranche of the capital increase of the SME partial portfolio credit guarantee (PPCG) and assists the Central bank of Madagascar in the upgrade of the of the RTGS/ACH. The implementation of the Project Preparation Advance (PPA) has started in January 2017, under the responsibility of the Direction des Operations Financières, a Unit under the Directorate General of the Treasury in the Ministry of Finance. The activities planned under the PPA are mainly focused around moving towards effectiveness of the project. Good progress was made on setting up the Project Implementation Unit with the Project Coordinator hired in Mid-May 2018 and starting to implement the activities agreed under the PPA. The Finance Officer of the Project was also hired and the recruitment of the rest of the core PIU team is ongoing. The Terms of Reference for the activities under the preparation of the mapping of government payments flows and the financial education campaign were launched. The procurement of the Operations Manual for the implementation of the project is underway. The designated account of the project has been established. As regard the retroactive financing: The capital increase of an amount of $2.5 million the SME partial portfolio credit guarantee (PPCG) was disbursed by the Government on January, The procurement of the material used to support the upgrade of RTGS/ACH of the Central Bank is ongoing. Under the retroactive financing arrangement, it was agreed that the World Bank will reimburse the Government and the Central Bank after Project effectiveness. The project s impact evaluation is also underway, with support from a DFID trust fund. The impact evaluation will focus on measuring the impact of transitioning to digital financial services on overall household welfare and economic empowerment. The impact evaluation team is working with the Ministry of Education, CNFI, and telcos to design a study to rigorously measure the impact of the digitization of teacher salaries and the financial education campaigns. The implementation support mission for the PPA was conducted on May 28-31, 2018 Risks Systematic Operations Risk-rating Tool Risk Category Rating at Approval Previous Rating Current Rating Political and Governance High -- High Macroeconomic Substantial -- Substantial Sector Strategies and Policies Moderate -- Moderate Technical Design of Project or Program Substantial -- Substantial Institutional Capacity for Implementation and Sustainability Substantial -- Moderate Fiduciary Substantial -- Moderate Environment and Social Moderate -- Moderate Stakeholders Substantial -- Substantial Other Overall Substantial -- Moderate Results 6/8/2018 Page 2 of 8

3 Project Development Objective Indicators PHINDPDOTBL Number of currently unbanked (i) FRAM teachers/students that receive their government salary/scholarship and (ii) businesses that pay the "impot synthetique" through a transaction account (Number (Thousand), Custom) Value Date 18-Oct May Jul-2022 PHINDPDOTBL Number (cumulative) of MSME borrowers that banks and MFIs have registered under the partial portfolio credit guarantee since effectiveness of the project (Number (Thousand), Custom) Value Date 18-Oct May Jul-2022 Overall Comments Awaiting for the project to be effective to assess the progress toward results indicators Intermediate Results Indicators The number of MFIs that allow loan repayment through a mobile money account ( wallet-to-account ) (Number, Custom) Value /8/2018 Page 3 of 8

4 Shared MIS developed and operational (Yes/No, Custom) Value N -- N Y National Switch developed and operational (Yes/No, Custom) Value N -- N Y Number of consumers reached by the financial education campaign via mobile phone messages (Number (Thousand), Custom) Value Date 17-Oct May Jun-2021 Number of female consumers reached by the financial education campaign via mobile phone messages (Number (Thousand), Custom Supplement) Value /8/2018 Page 4 of 8

5 Percentage of loans extended to MSMEs registered under the portfolio guarantee that are non-performing (Percentage, Custom) Value Number of enterprises reached with BDS (Number, Custom) Value Number of women-led enterprises reached with BDS (Number, Custom Supplement) Value Number of clients of the new MFI branches established through the project (Number (Thousand), Custom) Value /8/2018 Page 5 of 8

6 Number of female clients of the new MFI branches established through the project (Number (Thousand), Custom Supplement) Value Banks and MFIs report data to a centralized electronic collateral registry (Yes/No, Custom) Value N -- N Y Percentage of banks and microfinance institutions reporting data to the CBSF on financial consumer complaints (Percentage, Custom) Value Report drafted annually on Citizen Engagement Survey (Yes/No, Custom) Value N -- N Y 6/8/2018 Page 6 of 8

7 Number of currently unbanked female (i) teachers/students that receive their government salary/scholarship and (ii) businesses that pay the "impot synthetique" through a transaction account (Number (Thousand), Custom) Value Overall Comments Data on Financial Performance Disbursements (by loan) Project Loan/Credit/TF Status Currency Original Revised Cancelled Disbursed Undisbursed Disbursed P IDA Not Effective USD % Key Dates (by loan) Project Loan/Credit/TF Status Approval Date Signing Date Effectiveness Date Orig. Closing Date Rev. Closing Date P IDA Not Effective 28-Feb Apr Jul Jul-2022 Cumulative Disbursements 6/8/2018 Page 7 of 8

8 Restructuring History There has been no restructuring to date. Related Project(s) There are no related projects. 6/8/2018 Page 8 of 8