1. Neelesh Man Singh Pradhan CEO, NCHL 10th Sep 2019
Fostering Innovation in Public Sector
Role of ICT
Neelesh Man Singh Pradhan
Chief Executive Officer, NCHL
5th Dec 2019
Impact of electronic payments on economic growth
0.1% to 0.3% increase on global GDP due to higher card usage
- Moody’s Analytics based on 70 countries between 2011 – 2015
Neelesh Man Singh Pradhan CEO, NCHL 10th Sep 2019

2. Agenda NCHL Overview Innovation in Public Sector
Innovation Types in Public Sector
Public Sector Innovation Framework
Emerging Trends in Public Sector Innovation
Examples
Takeaways
Q & A

3. Nepal Clearing House Ltd. - An Overview
Promoted by Nepal Rastra Bank (central bank of Nepal) and the banks & financial institutionsto establish and operate national payment systems.
5 national payment systems in operations.
Work with the stakeholders including central bank, various departments of GoN, BFIs, others.
Facilitate for policy and regulation drafting required for digital payment ecosystem
NCHL Product/Service Roadmap

4. NCHL Overview: Product/ Services
Paper based instruments including cheques, MC, Drafts (NPR, USD, EUR, GBP)
Daily Txn Value: NRs 30 Billion+
Instruction based payments - Direct Credit & Direct Debit) (NPR, USD, EUR, GBP)
Daily Txn Value: NRs 7 Billion
Processes real-time retail txns (NPR) from alternate channels
Mobile app, payment gateway, APIs, Bank
Daily Txn Value: NRs 40 Cr +
Consolidated APIs of NCHL-IPS, connectIPS and other system
Interfaces for alternate channels (Mobile, Internet, Corporate), Other institutions/members.
Integration component for BFIs to connect NRB’s RTGS system.
Interface RTGS & BFI’s CBS
Primary focus on payment system infrastructure development with BFIs (A, B, C) as Direct Members.
Non-bank institutions (financial & others) required for overall development of payments ecosystem.
Access provided as Indirect/ Technical Members (with transactions through bank accounts of BFIs).
Few non-bank entities include: GoN (FCGO, IRD, PSC, OCR, Passport), EPF, CIT, SSF, NEPSE & Brokers, Merchant banks, Remittance, Insurance, PSPs/PSOs (digital wallet & other providers), etc.
Public Enterprises

5. Innovation in Public Sector
Focus of Public Sector
What core service?
How to deliver?
Compliance
Procedure

6. Innovation in Public Sector
Why Public Sector is behind the curve on innovation?
Over the last years, it was the public sector that developed majority of the original information technology system. Eg. Telephone, Internet.
Either outdated today or need major upgrades.
Resistance to change
One of the major constrain being the procurement & long budget cycle (desire to have fixed cost model)
Why is now the time to innovate for Public Sectors?
Increasing expectations from citizens: Fast paced, digital society expect to have same level expectation as from private entities. Eg. Private Vs Govt bank;
Shorter technology timespan: Technology today has shorter lifespan. Eg. Land line phone Vs Mobile phones
Security threats: Requirement to harden the legacy systems of public sector.

7. Innovation Type in Public Sector

8. Public Sector Innovation Framework

9. Emerging Trends in Public Sector Innovation
Combining human and machine data:
Governments are finding new ways of combining the insights of citizens with machine-generated data and analytics to improve government services.
Examples:
Nepal Police responding on their official facebook on the comments by general public
Automated data analytics built around social media to trace and respond on immergencies (eg. Twitcident of Finland Police)

10. Emerging Trends in Public Sector Innovation
Scaling Government:
Finding new ways to scale up innovation, from small-scale pilots to larger government initiatives (labs, incubators, etc.)
Example
Nepal’s IdeaStudio – Public private partnership to incubate startups and supporting them in execution.
Australia has launched DataStart, a public-private partnership to find, incubate and accelerate start-up ideas that leverage openly available data from the Australian Government

11. Emerging Trends in Public Sector Innovation
Citizens as experts:
Engaging citizens at every stage of the policy cycle: from shaping ideas to designing, delivering and monitoring public services.
Examples
HelloSarkar of Government of Nepal, Office of Prime Minister for collection complain rederessals from public directly
Finland’s Place to Experiment platform connects citizen innovators with government and crowdfunded resources to find new ways to strengthen government programs.

12. Emerging Trends in Public Sector Innovation
Personalized services:
Designing user-centred services that provide holistic solutions which are more attuned to the needs of each individual citizen
Example
Department of Civil Registration Nepal – Providing online registration of all social events.
mGene at UAE’s Al Qassimi Hospital to capture newborn baby’s facial photo to identify congenital birth defects

13. Emerging Trends in Public Sector Innovation
Experimental government:
By testing and validating new ideas at a manageable scale before diffusing and scaling-up, governments can explore new solutions while minimizing cost.
Example
Random sampling of digitally submitted tax information by Inland Revenue Department of Nepal

14. Final Takeaways
Innovation is all about change: To achieve real change, engage with what might be and not just what is. Think for future 5-10 years from today
Innovation to focus at the core of the Public Sector, namely Service, Process, Regulation and Policy
Data and Information are critical. Data driven models of innovation.
Engage citizens and prototyping is important