Interoperability of Financial Services Providers: Afghanistan

To distribute cash to Afghan families living in poverty exacerbated by the political events of August 2021,humanitarian agencies and development partners need simple, fast, transparent and cost-effective ways to release and channel cash-based interventions to those who need it the most, in particular those in remote areas and women. A robust digital payment ecosystem includes a secure digital payments infrastructure inclusive of all private sector players so that beneficiaries can receive funds into any account and then conveniently and affordably use or cash out those funds. Given the limited availability of cash-out points or merchant payments, interoperability is key to reducing infrastructure investments of individual financial service providers.

This report looks at what's needed to restart the Afghanistan Payment System and ensure interoperability so that digital payments can be adopted across the country. It analyses the current situation, notes the major challenges and suggests a number of policy and practical steps as ways forward.