Karandaaz Pakistan is a company established under the Section 42 of Companies Ordinance 1984 to promote access to finance for small businesses through a commercially directed investment platform, and financial inclusion for individuals by employing technology enabled digital solutions. It has financial and institutional support from leading international development finance institutions; principally the United Kingdom Department for International Development (UKAid) and the Bill & Melinda Gates Foundation.
To spur innovation and entrepreneurship, Karandaaz is launching an Innovation Challenge Fund (ICF) as a mechanism to provide patient capital, convertible debt or matching grants to potential partners. The overall objective is to invite entities to solve complex problems using innovative yet practicable solutions which will be funded and supported by Karandaaz.
Innovation Challenge Fund
The first round will focus on improving the current mechanism of foreign remittances from Pakistani workers employed in different parts of the world. Some of the crucial aspects which need improvement are the outreach (specifically rural), speed, security, cost, ease of use and increased awareness. Under the First Challenge Round of the ICF, applications are invited to propose an innovative product, service or approach to improve the current delivery mechanism.
Growth of remittances is not only slowing down but is showing a negative trend in Pakistan. There are approximately 7 million Pakistani’s residing overseas in about 140 countries. Out of these, 48% are working in the Middle East while around 28% are working in Europe.
The main remittance channels are commercial banks, Exchange Companies (EC) and Pakistan Post. However, some Mobile Network Operators and Microfinance Banks are also providing the service through partnerships.
Scope of Work
The solution can be targeted for a specific region (e.g. Middle East to Pakistan) or for wider services (with specific focus on rural areas). The key will be to propose a product or service which has the potential to be transformational for the remittance market and promises greater outreach. One of the key requirements of any proposal is ensuring prevention of money laundering and financing for terrorism as per SBP’s regulations.
The objectives of this Challenge Round are similar to the objectives outlined above:
- Provide fast, cheap, reliable and secure foreign remittance services to workers living outside Pakistan
- Improve accessibility for people in all parts of Pakistan including rural and remote areas
- Improve accessibility for women and youth
- Increase awareness among current and potential users of the services available and/or proposed
- Provide a solution that overcomes challenges or low literacy and lack of understanding of benefits of financial services
- Leverage private sector interest and investment
- Leverage ICT and other innovations in financial services delivery
Evaluation Criteria for EOI
The EOI’s will be evaluated primarily on the innovativeness of the approach and on the operational viability given environmental and regulatory constraints. Once shortlisting of applications has been done, the applicants will be asked to submit a detailed business plan within an agreed deadline.
Expected Timeline and Process Flow
The tentative timeline for applicant selection is as follows:
- Shortlist applicants based on EOIs: 4th week of October
- Submission of Detailed Business Plan by shortlisted applicants: 3rd week of November
- Business Plan Presentation to Advisory Committee and Review Business Plans: 2nd week of December
- Inform applicants of final decision: 1st week of January
- Award of Funds: 1st week of January
Applicants are requested to complete the EOI form. EOIs must be submitted by 12:00 noon on 24th of October, 2016 (Pakistan Standard Time) by:
- e-mail at [email protected]
- Courier at 1 E, Ali Plaza, Nazim ud din Road, D-Chowk, Islamabad.
EOIs submitted after the deadline will not be considered for shortlisting.
All queries on the process and EOI form for Round 1 of the Innovation Challenge Fund may be sent to [email protected] no later than the 20th of October 2016.