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Key Tool: Example of Key Standard Operating Proceduresfor use of Prepaid Card or Mobile Payment

PURPOSE:

The purpose of this example is to help organizations standardize proceduresfor making payments using a prepaid card or mobile payment modality. Standard operating procedures (SOP) are internal and unique to each organization.This document should be used as a guide to identify areas that may need to be adjusted in your organization’s SOP when transitioning to electronic payments (especially card and mobile payments).

GENERAL SUGGESTIONS:

  • Make sure you engage the service provider when developing your SOP to ensure the payment product has the ability to meet the needs of your internal procedures.
  • Try to assimilate as much of your previous payment procedures into the adapted SOP for prepaid card and mobile payments. The process should be very similar to a bank wire transfer with some slight variations.
  • Work with your finance team to establish a champion on the staff who will take on the majority of management around pushing out payments through prepaid cards or mobile devices. Some organizations have even created entire accounting positions to manage these specific payments.

The suggested procedures in this example focus strictly on financial procedures that lead to the release of funds (payment). Another very important part of the payment procedure is ensuring all recipients are registered and trained on how to use the payment modality. Please refer to Step 8 in the Toolkit for more information on registering and training recipients.

DEFINITIONS:

Mobile Payment- a form of payment services performed from or via a mobile device. In this case, the SOP refers to a mobile bulk payment, which is making payments from one to many via a mobileplatform.

Card Payment- a form of payment services performed via a magnetic strip or smart card that stores a designated amount of value in addition to recipient information. In this case, the SOP refers to a card bulk payment, which is defined by making payments from one to many via a card platform.

Service Provider - The service provider in this case is the bank, Mobile Network Operator, or third party payment provider who have been contracted to provide the payment service, whether it be through card or mobile payment methods.

Recipient– The recipient is the person receiving the mobile or card payment.

Payer- The Payer is the organization pushing out the payment, and developing the SOP.

Agent (Mobile payments)–Is a person registered with the service provider that provides cash in and cash out services to the recipient. It is key for a variety of agents with sufficient liquidity to be located in

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the area where recipients will be receive funds to ensure recipients are able to withdraw cash as they need it.

Point of Sale Terminal (Card payments)- A point of sale (POS) terminal enables recipients to cash in and cash out. Like an agent, it is key that there are POS terminals (i.e. ATM, or agent with a POS terminal) with sufficient liquidity located in the area where recipients receive funds.

Maker: The maker is a member of staff whose responsibility in the payment process is to create the list of recipients that will be used to direct the transaction

Checker: The checker is a member of staff whose responsibility in the payment process is to review the list of recipients created by the maker. The checker is responsible for ensuring the accuracy of the information before the payment is made

Approver: The approver is a member of staff, normally leadership with signatory authority, that provides the final review and approval of the payment.

RESPONSIBLE PERSONS:

This section of an organization’s SOP will vary depending on how the organization manages current payment procedures. The table highlights the staffmost commonly involved in mobile or card payments.

PROCEDURE:

This section of an organization’s SOP shoulddescribe the steps in the payment process and assign responsibility to staff. There procedures may vary based on where the payments are: 1) recurring payments, i.e. payments made on a regular basis to staff, field worker stipends, or vendors whose payment information may be stored for future use; or 2) Nonrecurring payments, i.e. one off payments made to training participants for per diem or transportation reimbursement costs.

RECURRING PAYMENTS

Activity / Description / Responsibility
Funds Preparation / If the organization’s bank account is not directly linked to the payment provider's system, the necessary funds should be transferred from the organization's bank account to the electronic value account established by the organizationwith the electronic payments provider (Mobile Network Operator, card issuer's bank, or third party provider). / Finance Staff
Payment Request / Any program staff requiring a paymentshould produce a payment request. If the organization is willing to adjust the format of their preexisting payment request, an excel or .csv file is a preferred format for the request (see form example below). / Program Staff (Maker)
Pre Verification / When the finance staff receives a payment request, they will upload the recipient information into the electronic payment system and verify all payment amounts are consistent with the payment requests. Most systems should be able to verify the recipient's information is correct automatically. / Finance Staff (Checker)
Approval/ Disbursement / Once the list is uploaded and verified, the checker sends the payment request onto the approver. The approver reviews the recipient list and payment request documentation a final time, and then approves the payment. Once the approval is finalized, this will signal the system to release the payments. / Finance Director or Country Director (Approver)
Verification of Receipt / There are two options to verify receipt of the payment. 1) The organization can rely on the transaction summary provided by the electronic payments provider that verifies each number/account the transaction was sent to has received or not received the funds. This transaction summary is usually immediate and real time, so the payer has a real time summary of the payment. 2) Some organizations may prefer to have a signature from each recipient verifying receipt of the funds. This can be done through an email confirmation from staff or vendor or a physical signature depending on your organization's level of control needs. This documentation then can be attached to the transaction summary. / Finance Staff and/or Program Staff
Reconciliation / All paperwork, including payment requests, transaction summaries, and payment receipt signatures (if needed) are returned to home office where the funds dispersed from bulk payment account are reconciled with paperwork. At this point any remaining funds in the electronic value account (if it is not directly connected to a bank account) can be returned to the organization’s bank account to ensure a correct balance on the bank ledger. Finance will need to apply the payments to the appropriate billing codes and file the backup documentation for auditing purposes. / Finance Staff

Non-Recurring Payments

Activity / Description / Responsibility
Funds Preparation / If the organization’s bank account is not directly linked to the payment provider's system, the necessary funds should be transferred from the organization's bank account to the electronic value account established by the organization with the electronic payments provider (Mobile Network Operator, card issuer's bank, or third party provider). / Finance Staff
Payment Request / The staff in the field should prepare a payment request that coincides with the preparation of the recipient list, or list of training participants receiving reimbursements for travel or meals and incidentals. The payment request may take several forms depending on the organization, but it is recommended the organization use a .csv or excel file format (see example below) to develop the list of names, phone numbers/card numbers in a format that can also be used to upload the recipient information into the bulk payment system. / Program Staff (Maker)
Pre Verification / Once the list of training participants is uploaded into the system by the maker, the checker, usually a member of the finance staff can review and verify the names and numbers on the list. Many bulk payment products are also able to verify the number through their system, making this process much easier. Once the checker verifies the names that have been uploaded into the system are consistent with the payment request, / Finance Staff (Checker)
Approval/ Disbursement / The approver looks through the list and payment request documentation a final time, and then approves the payment. Once the approval is finalized, this will signal the system to release the payments. / Finance Director or Country Director
(Approver)
Verification of Receipt / There are two options organizations use to verify receipt of the payment. 1) The organization can rely on the transaction summary provided by the electronic payments provider that verifies each number/account the transaction was sent to has received or not received the funds. This transaction summary is usually immediate and real time, so the payer has a real time summary of the payment. 2) Some organizations may prefer to have a signature from each recipient verifying receipt of the funds. This can be done at the end of the training on each day when the payment has been made. All training attendees must sign by their name on the attendance list, this confirms they have received. This documentation then can be attached to the transaction summary. / Finance Staff and/or Program Staff
Reconciliation / All paperwork, including payment requests, transaction summaries, and payment receipt signatures (if needed) are returned to home office where the funds dispersed from bulk payment account are reconciled with paperwork and filed. At this point any remaining funds in the electronic value account (if it is not directly connected to the organization’s bank account) can be returned to a bank account to ensure a correct balance on the organization’s bank ledger. Finance will need to apply the payments to the appropriate billing codes and file the backup documentation for auditing purposes. / Finance Staff

Payment Request in Format Examples:

Recurring Payment:

First Name / Last Name / Phone/Card Number / Purpose of Payment / Amount

Non-recurring Payment:

Training:

Date:

Location:

Program Staff Name:

By signing this sheet you verify that a) you have attended this training for its entirety and b) that you have received the payment for per diem and travel reimbursement

First Name / Last Name / Phone/Card Number / Amount / Attendance Signature / Payment Receipt Signature

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