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Expression of Interest for Developing Innovative Financial Products under the Challenge Fund of the Rural Financial Inclusion in Palestine Project (RUFIPP). Service Location: Palestine The Palestinian Authority has received financing from the International Fund for Agricultural Development (IFAD), the European Union (EU), and the Spanish Agency for International Development Cooperation towards the cost of Rural Financial Inclusion Project in Palestine "RUFIPP and intends to apply a portion of these proceeds to award grants for Developing Innovative Financial Products under the Challenge Fund of the RUFIPP. About RUFIPP The Rural Financial Inclusion Project in Palestine (RUFIPP) implemented by the Ministry of Finance and the Ministry of Agriculture aims to increase communities resilience against the economic and environmental shocks and improve the livelihoods of poor, excluded people. The development objective of the RUFIPP is to improve the resilient economic growth and incomes of smallholder farmers and expansion of small holders and rural enterprises through increased awareness and knowledge about financial services and enhanced access to appropriate and affordable financial products. This will be achieved through building the capacity of smallholder farmers, micro, small and medium enterprises, financial institutions and a supportive policy environment through technical assistance, research and improved coordination, networking and building partnerships. RUFIPP was approved by IFAD Executive Board on 24 September 2024 and came into force in April 2025. The overall project implementation period is 5 years. About the Challenge Fund The purpose of the Challenge Fund is to stimulate the development of new or refined existing financial services that meet the needs of RUFIPP target beneficiaries. The Challenge Fund will provide incentives and financial support, on a competitive and matching contribution basis, to institutions wishing to support product and service development innovations to serve targeted beneficiaries. The Challenge Fund will have two support windows: Inclusive and green financial services: The objective of this window is to promote inclusive and green financial products and services innovation for rural smallholder households and their enterprises. FSPs will propose projects and will be encouraged to link services to existing programmes with complementary activities (e.g., value chain production support, non-financial micro/ small enterprise and production support projects etc.). Priority will be given to proposals with distinct climate and nature-based solutions for smallholder farmers. Digitally-led financial service innovation: This window will complement the first window by providing support to develop innovations in digital finance leading to the expansion of existing and the creation of new financial services. Products and services eligible for funding Innovative financial products and services eligible for funding under the Challenge Fund can include, but will not be limited to the following: Window 1: Inclusive and green financial services Alternative individual and or collective collateral innovations (e.g., warehouse receipts, movable collateral including future harvest, buyer contracts, etc.); Climate adaptation lending/savings programmes/leasing/pay as you go (e.g., natural or artificial shade, drip irrigation etc.); Mitigation and carbon sequester asset lending/savings programmes/leasing pay as you go (e.g., CO2 sequester, solar energy); Nature based solutions lending/savings programmes/leasing pay as you go (e.g., reduced fertilizer input, natural water and soil regeneration processes, organic production, permaculture solutions, water harvesting and treated wastewater; improving irrigation systems; optimizing fertilization; investing in facilities to reduce post-harvest losses; accessing renewable energy for agricultural production and processing; enhancing waste management; and, increasing livestock productivity, natural and artificial shade cover, micro-harvesting, mulching paper etc.); Climate risks mechanisms (i.e. area yield and/or weather index, livestock insurance, creditor insurance, alternative insurance distribution channels, and linking insurance to agricultural loans); Leveraging remittances to provide new or more tailored financial services (e.g., remittance-based savings and loan programmes incentivizing both sender and recipient to invest remittances in productive activities; Value chain/production investment, de-risking, savings, alternative collateral products for individuals and or on collective basis (input loans/ bulk savings, warehouse lending, etc.); Strengthening and expanding outreach of community based financial institutions; Financial products and services that are gender and youth centric and address their capital and working capital investment needs; Financial education programs aimed at improving financial and business literacy of rural communities, including, but not limited to environmental and social dimensions of production and enterprise development for awareness on green and climate-resilient investments (including financial education programs being developed by financial services providers under Component 1, Subcomponent 1.1). Window 2: Digitally-led financial service innovation Promoting and expanding existing digital finance: Rural market existing mobile banking market expansion campaigns; Client economic and financial transaction digitization for financial and/or climate risk analysis and or alternative collateral; Expansion of financial transaction applications for loans, savings, insurance payments; Providing climate-based lending applications. Promoting alternative distribution and service suppliers: Digitizing MFIs and community credit and savings groups; Digitizing value target beneficiary chain transaction records for input supplier/ aggregator lending risk analysis and alternative collateral. Provision of market and climate-based business and extension services (either in combination with financial services or not); Promoting of remittance-linked financial products for Palestinians: Matching grants schemes in favor of migrant families exhibiting a remittances transaction record with the MFIs, and savings accrued in a bank to access agricultural loans for equipment and long-term investment in farming activities. Development of specific digitally enabled remittances linked to other financial products for the agricultural value chain such as crop payment or agricultural inputs purchase Support private sector for innovative initiatives on remittances. Eligible participants The Challenge Fund financing will be available for formal and registered financial institutions such as banks, microfinance organizations, and other related registered institutions such as savings and credit cooperatives, as well as their associations, other apex organizations, insurance companies and private companies judged to have the competency to implement the projects proposed by them, interested in developing innovative financial products and solutions for the RUFIPP target group and committed to piloting and disseminating these products and documenting lessons learned. Grant proposals must demonstrate how activities meet the needs of target beneficiaries, ideally the long-term sustainability of financial products and services related to climate/ green outcomes. Projects meeting the needs of and demonstrating specific outcomes for women, youth and climate adaptation, mitigation, and nature-based solution benefits will be given higher consideration. Eligible expenses Grant funds allocated under the project may be used to cover the following costs: Payment for the work of experts in the research and development of innovative financial products; Purchase of necessary technological equipment; Training of interested financial institutions; Documentation and dissemination of lessons learnt. Ineligible expenses The project will not finance the following costs: Equipment leasing, rental of land plots and facilities; Bank commissions, guarantee costs and similar payments; The cost of intellectual property rights, as well as patent and license acquisition costs; General costs related to the development/design of the grant proposals; Construction and modernization of residential buildings and office premises; Acquisition of second-hand goods; Acquisition of land; Vehicles for personal use and purchase of passenger transport; Environmentally damaging chemicals, radioactive materials, explosives, detonating agents, blasting agents and items filled with them. Activities included in, or otherwise not compliant with, IFADs Environmental and Social Exclusion List which covers activities such as those involving hazardous chemicals, radioactive materials, explosives, and other environmentally or socially harmful practices are not eligible for funding under the Challenge Fund. Conditions for funding grant proposals Grant proposals will be funded if they meet the following minimum criteria: The grant proposal is submitted by an eligible applicant The purpose of the grant proposal is to be aligned with the objectives of the grant windows as described above The applicant is able to provide the required co-funding Grant Proposal budget Funding support provided for various types of projects will be subject to the following upper limits. Idea generation and mobilization: Support to research and undertake market analysis of specific financial product or service. The objective is to demonstrate plausible business model, marketability, and sustainability. Idea prototyping and piloting: Advanced project ideas will be eligible for prototype development and pilot testing. The objective is to generate a proof concep Tender Link : https://www.jobs.ps/en/tenders/mofp-rufipp-2026-07-16296.html
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