About 100 million people are still being pushed into “extreme poverty” (living on $1.90 or less a day) because they have to pay for health care. Over 800 million people (almost 12 percent of the world’s population) spend at least 10 percent of their household income to pay for health care. Women are especially vulnerable to extreme poverty as they typically have more restricted access to financial and productive assets than men, and they shoulder a greater burden of unpaid time use. Gender inequality is high in many countries facing high extreme poverty rates, and women in low- and middle-income countries are less likely than men to own mobile phones and to access internet-based mobile services.

Financial protection is achieved when direct payments made to obtain health services do not expose people to financial hardship and do not threaten living standards. Financial protection is at the core of universal health coverage and is one of the final coverage goals of the Sustainable Development Goals. Out-of-pocket payments for health care can cause households to incur catastrophic expenditures, which in turn can push them into poverty. A key to protecting people is to ensure prepayment (savings) and pooling of resources (insurance) for health, rather than relying on people paying for health services out-of-pocket at the time of use.

Advances in digital technology have made it more efficient and affordable to reach people with key services. For example, the ubiquity of mobile telephony and mobile phone penetration provides opportunities for public and private service provision, at new and unprecedented levels, amplifying population reach and coverage. Likewise, data from digital channels and solutions provide key information, feeding analysis for decision-making, which can support continuous improvement of health system management and performance.

What is financial inclusion and why does it matter?

Financial inclusion is when individuals and businesses have access to useful and affordable financial products and services—savings, loans, insurance, remittances, and bill payments—that meet their needs, delivered in a responsible and sustainable way.

Financially included people have access to financial services that can support well-being (savings, remittances, and insurance) during stable times and prevent deepening levels of poverty during crisis. Likewise, people with access to lending or other forms of financing can use these services to build productive assets like businesses, fostering enterprise growth and development.

What are digital financial services?

Digital financial services (DFS) are financial products and payment services (e.g., savings, loans, insurance, remittances, and bill payments) that are enabled via electronic channels. Products and services can be accessed using mobile phones, electronic cards (e.g., credit cards, debit cards, and prepaid cards), computers, and other electronic instruments.

Purpose of the landscaping exercise

Building on the March 2019 publication of The Role of Digital Financial Services in Accelerating USAID’s Health Goals, USAID’s Global Health Bureau, via its Office of Health Systems and its Center for Innovation and Impact, is considering commissioning a landscaping assessment on the role of digital financial solutions in the context of efforts both to advance financial protection and to support improved health system performance. If funded, the purpose of this report would be to help audiences understand the factors (beyond digitization) that make these solutions successful and the role that digitization can play in enhancing and leveraging these factors.

Generally, the assessment may seek to understand the following questions:

• To what extent have digital financial services in low-resource health systems contributed to the following outcomes:
  • Increased financial protection among health system clients, including the poor and vulnerable.
  • Increased demand and use of health services among clients, including the poor and most vulnerable.
  • Improved health systems performance, defined as improved quality and responsiveness of service providers.
• Implementation considerations, including: 
  • What barriers/challenges were faced in the implementation of DFS?
  • How did programs adapt?
  • Where successful, what were the critical components in implementation?
  • How and why have providers and implementations incorporated DFS into broader digital solutions or complemented DFS with broader digital solutions?
  • In regard to digitalization, what are examples of successful change management processes (effective approaches of moving from paper-based to digital management systems) to maximize potential results?

This assessment fundamentally aims to understand whether digital financial solutions can enhance the impact of HSS activities, and in what contexts. The research questions aim to identify, where possible, the potential contributions specifically of DFS to advancing financial protection and strengthening health systems, even when those solutions are embedded within broader service delivery packages. Through a literature review and remote consultations at minimum, this exercise will engage leading digital health service providers, associated health facilities, and their clients in key geographies to understand results and gather lessons.

The main deliverable is expected to be a final, detailed landscape report that describes the context, methodology, findings, and conclusions of this work. The final report will be made publicly available. A shortened version of the report may also be submitted as a commentary or similar type of paper for an appropriate peer-reviewed journal.

As part of the anticipated collaboration, the partner(s) will be expected to engage regularly with USAID.

Click here to access RFA #2019-020 Digital Financial Services on Health Outcomes and Health Systems.