NORMATIVE FRAMEWORK

TCP PROJECT FORMAT

"Improving Delivery of Financial Services to Rural Areas"

I. PROJECT SUMMARY

This is a concise statement of the results stemming from the problem statement (below) that are expected by the end of the project.

Data Needs:

Main features of the project with emphasis on expected outcomes.

Data Sources:

Individual sections of project report

II. BACKGROUND AND JUSTIFICATION

Identify the problem for which assistance is requested and provide evidence that TCP criteria - which govern eligibility for TCP funding - are met. Text should cover the following issues:

describe the main features of the financial sector in the country concerned;
describe briefly the role of agriculture in the economy and related financial services;
indicate any constraints that may exist in the delivery of financial services in rural areas;
provide a critical review of the general and regulatory framework affecting the delivery of financial services in rural areas;
indicate the role of specialized agricultural development banks, commercial banks and other, privately, owned financial institutions;
indicate need for restructuring rural financial systems to establish more effective linkages between savings, deposits and credit;
indicate scope for introducing implementing systems (including banking software for small and medium size institutions) and operational procedures to provide cost-effective and sustainable financial services in rural areas;
describe the primary target financial institutions;
state why the TCP assistance is needed and how it fits into Government development plans for rural development.

There should be a clear element of capacity building in order for the Government to sustain project results. One paragraph should state how the Government and the Ministry of Agriculture/Credit Department intend to build upon the technical assistance provided. That should include the long-term and sustainable advantage that is expected to result from the TCP assistance. The Government contribution to realizing this advantage should be described.

Data Needs:

Shares of private and public sector institutions in delivering financial services to rural areas.
Network of branches
Breakdown of financial services delivered by type of loans.
Respective shares of seasonal and term loans.
Current lending conditions.
Annual disbursements, number and typical profiles of borrowers
Amounts of savings collected.
Degree of computerization of the banks' administrative and financial operations at Head Office and Branches.

Data Sources:

Ministry of Agriculture/Credit Department
Ministry of Finance/Plan
Central Bank
Head offices of financing institutions (public/private sector)
Chamber of Commerce

Farmers’ Associations

III. OBJECTIVES OF THE ASSISTANCE

"This section will state briefly but in specific terms, the particular objective(s) which the project is expected to achieve. The project objective is defined as a specific aim to be achieved and formulated as the expected future improved situation after the successful completion of the project. The statement should be drafted wherever possible in terms permitting subsequent verification of project accomplishments." (TCP Guidelines)

A concise statement on current state of financial services in rural areas (with particular reference to agricultural sector needs) and a situation be reached by the end of the project.

Quantitative indicators should allow verification of: (i) reaching the planned improved delivery of financial services, and (ii) achieving stated outputs by the end of the project.

Data Needs:

Quantitative indicators to monitor the delivery of financial services to rural areas.

Data Sources:

Financial institutions concerned
Ministry of Agriculture/Credit Department
Farmers’ Associations

IV. PROJECT OUTPUTS (RESULTS)

"Outputs (results) to be defined in this section, are the specific products of activities undertaken, the combined use of which by project beneficiaries will achieve the objective of the project, provided assumptions about external factors are correct. They should be defined in terms that permit their verification in quantity, quality and time, and should be consistent with the project objective and design, and provide the basis for the elaboration of a clear, detailed work plan." (TCP Guidelines)

This section is a simple, concise listing, using quantitative terms, of the specific outputs expected from the project. These tangible outputs can be elaborated in bullet points.

Data Needs:

Number and type of documents/guidelines prepared.
Number of workshops/seminars held.
Nature of modifications made to FAO Micro-Banking System.
Details of improvements to network of branches in rural areas.
Number of professional bank staff trained.
Number of support staff trained.

Data Sources:

Ministry of Agriculture/Credit Department
Financial institution(s) concerned
FAO Technical Division concerned

V. WORK PLAN

A timetable, sufficiently specific to serve as a practical guide for the national experts and consultants on what activity should be carried out at what time, what place and be implemented by whom.

The timetable and any accompanying narrative should also serve as an instrument for monitoring project implementation and achievement for both the Government and FAO.

Data Needs:

Estimate and logical sequence of the major project activities and input needs.

Data Sources:

Ministry of Agriculture/Credit Department
Financial institution(s) concerned
FAO Technical Division concerned

VI. CAPACITY BUILDING

A paragraph describing how TCP assistance is expected to enhance the capacity of national professional staff in financial institutions in terms of improving the delivery of efficient financial services to a growing number of rural households. It should include details of how the use of such experts will contribute to building capacity in the national institutions/country concerned.

Data Needs:

Numerical data on national staff that would benefit from participation in workshops/seminars/training courses held under the project.

Data Sources:

Ministry of Agriculture/Credit Department
FAO Technical Division concerned

VII. INPUTS TO BE PROVIDED BY FAO

See TCP Guidelines, Annex 1, pages iii to vi.

A concise description of each input under the respective numbered line items below. Sufficient detail on each budget line should be provided. The sum of related amounts of each sub-category under each line item should add up to the total for the line item. Supplies and Materials and Equipment line items can be detailed, item by item, in an annex. The number to be procured and estimated costs of each item need to be shown. A "miscellaneous" item is not accepted but "miscellaneous laboratory glassware" is acceptable.

1. Personnel services

Technical services of international and/or national experts/consultants
- International consultants/experts
- FAO Advisory Technical Services (ATS)
- National experts and consultants
- International expertise under Partnership Programmes (i.e. TCDC/TCCT or Retired experts and consultants)
- Administrative support
- Supervisory Technical Services (STS)

Priority and preference should be given to the employment of competent experts under the TCDC/TCCT programmes in countries that have signed these agreements. There are specific limits to the use of international expertise at UN rates. Project drafters are advised to consult with the TCP Unit before preparing the staffing inputs and budgets.

2. Official travel
3. Contracts, Letters of Agreements or Contractual Service Agreements
4. General operating expenses (GOE)
5. Materials, supplies and equipment:

Materials and supplies
Equipment

6. Direct operating cost (DOC)
7. Training:
- Study tours
- In-country workshops
- Fellowships and academic training
- Young Professionals for on-the-job training

Data Needs:

Number, type and cost of each input (numbers of staff participating, of items, internal trips, cost per day, DSA rate, monthly consultant rate etc).

Data Sources:

Ministry of Agriculture/Credit Department
FAO
UNDP
Local suppliers

VIII. REPORTING

See TCP Guidelines.

Periodic and Mission reports are required for operational monitoring of projects so that technical and operating divisions of FAO can monitor the delivery and utilization of inputs. These reports give a TCP project the required flexibility to meet changing needs and are used to make decisions about project extensions and budget revisions. Technical reports add to the body of knowledge on improving financial services in rural areas.

It is essential that the document specify who is to prepare these reports and at what intervals. This is particularly true for the Terminal Statement. If the writer of this document is not specified, the technical officer assumes this responsibility.

Data Needs:

Operation-related data/information on the improvement of financial services in rural areas. related to the country concerned.
Findings and facts relevant to the status of efficiency in delivering financial services.
Consultant's itinerary, persons met, terms of reference, lists of additional equipment etc.
Trends in loan disbursement and recovery and collection of deposits in rural areas.

Data Sources:

Project records
Project staff
Records from financing institutions involved
Participatory rural appraisal exercises
Ministry of Agriculture/Credit Department

IX. GOVERNMENT CONTRIBUTION AND SUPPORTING ARRANGEMENTS

This paragraph needs to clearly set out the resources to be contributed by Government and/or financial institution involved essential for an effective implementation of the project.

See in particular TCP Guidelines, Annex I, page vii and the following excerpts:
Request must be accorded high priority by the Government, which must also ensure that the required local support facilities and services will be available and that follow-up action will be taken...

Requests must provide assurance of the fullest possible participation of the Government in project execution, through such means as the use of national institutions, personnel and resources. (Annex IVa, page i).

Each project should be supervised by a National Project Coordinator nominated and paid by the Government. National Project Professional Personnel or consultants recruited by FAO are fully accountable to the Organization and cannot be on the Government payroll at the time of their assignment. (page 10, par 46) They may not be recruited from the counterpart institution/cooperating agency. (Annex 1, page iv).

Data Needs:

Government and/or financial institutions' contribution in terms of cash, personnel time, facilities, vehicles, laboratories, building and office space (for workshops and other), secretarial and translation/interpretation expertise.

Data Sources:

Ministry of Agriculture/Credit Department
Financial Institutions involved

X. PROJECT BUDGET

The project budget covering the FAO contribution is prepared by FAO, based on elements received from the requesting country.

Data Needs:

Numerical details on FAO contribution in US$ by budget line.

Data Sources:

Team Leader, plus national and international project staff
FAO
UNDP
Equipment suppliers
Travel agents

XI. ATTACHMENTS TO PROJECT AGREEMENT

1. Description of the training programme
2. Description of Advisory Technical Services and Supervisory Technical Services
3. Description of services to be provided under contracts
4. Itemized list of equipment
5. Itemized list of materials and supplies
6. Terms of reference including description of required qualifications for each international and national consultant/expert and where appropriate for the National Project Coordinator.

Data Needs:

Quantitative estimates and descriptions/specifications as relevant to the above attachment.

Terms of Reference (TOR) for each national and international project staff member including FAO technical staff members contributing to the project. TORs for short-term staff inputs (weeks to several months) need to describe precise, time bound activities and outputs expected. Longer-term staff inputs should be more generally phrased to allow some flexibility and cover unforeseen occurrences.

Data Sources:

Team Leader, plus national and international project staff
Ministry of Agriculture/Credit Department