Bolsa Família Program Cash Transfer Payments

1. Bolsa FamíliaProgramCash Transfer Payments Abuja, October 21st, 2009

2. BolsaFamilia - Basic flows Ministry of Social Development (MDS) 2. MDS determines eligibility Caixa (Federal Bank) 3. CEF pays directly to beneficiaries 1. 5.564 municipalities registry potential beneficiaries based on geographic quotas Municipalities

3. Registry, generation of cards and payments Generating payroll list and electronic card Registring of Beneficiaries

4. Management of Benefits Management of Benefits Regular payments Bloqueia, desbloqueia,cancela, reverte cancelamento

5. Payment process • Municipalities register poor families • After quality analysis, registered families are validated to receive benefits prioritizing according to income per capita • Prioritization made by the Federal Government through an information system . • Once benefits are defined, payment cards are generated and sent to beneficiary families through mail. • Beneficiary families are included in the payroll list for payment and verification of compliance • Families receive a payment calendar • MDS disburse funds to payment agency to pay benefits • Municipalities monitor co-responsibilities through an information system

6. Withdrawal of benefits • Families withdraw benefits using an electronic card • It serves as an identification document of enrollment in the BFP • It takes up to 4 months for a family to receive its electronic card but the goal is reducing the time in half • Main causes of slow disbursement of electronic cards: • Problem with families’ addresses • Families’ mobility • Inefficiencies in handling and • activation of cards

7. The Caixa Economica Federal (PaymentAgent) • The CEF, a public federal bank is the payment agent of BFP • The CEF is responsible to struture, managament and updating the database of the registry of beneficiaries and execute payment routines following the guidelines of the Ministry of Social Development.

8. Responsibilitisof CEF as paymentagent •  Provide the required infrastructure and organization to manage the Cadatro Único •  Develop information systems for data processing •  Organize and carry out payment logistics •  Prepare reports for payment reconciliation

9. Official CaixaEconomicabank agencies and branches • Lottery ticket outlets, which, in Brazil, also perform several financial transactions • Commercial establishments authorized by Caixa to perform financial transactions; must display the “Caixa Here” sign. • Automated Teller Machines (ATM) connected to Caixa's network under another bank's supervision. Outlets to cash benefits 7.482 24.369 1.125 5.569 Total: 38.545 Fonte: CAIXA

10. BolsaFamilia Program Payments Payment Amounts: 9.9 million (February 2009)

11. BFP seeksto open accountsto 5 millionfamilies

12. PBF's Payment Effectiveness(2003 to March 2009)

13. Payment process: Oversight and Control • Internal: • Quality tests (spot checks) to the CadastroUnico database • Cross checks with other Federal Government databases • Audits to identify multiple identities • Incentive to update CadastroUnico • Monitoring program coverage • External: • Social Control at local level • Oversight and control at Federal level

14. Current Logistic Challenges Regarding Payment of Benefits • In the region covered by the Amazon Forest there is a pressing need for expansion of payment channels available to the families • About 5% of beneficiaries can not withraw their benefits either because they do not receve their card or because there is not available payment point at a reasonable distance • Using the BFP to promote banking inclusion, creating more than 1.4 million checking accounts by beneficiaries in less than a year (2009) • Teaching families about financial matters in order to empower them how to use their benefits in the most effective manner