Financial Services Development Project
The Republic of Azerbaijan and the International Development Association signed an Agreement “On Development Credit” (Financial Services Development Project (FSDP) on May 24, 2005. The project, approved by order № 973 of the President of the Republic of Azerbaijan dated 25 August 2005, envisages developing financial services in the country by using the existing platform of postal operator Azerpost LLC. The project also aims to provide free access of population to banking financial services in rural and regional centers and offer a wide range of services to customers through 1200 post offices. The implementation of the project was launched on October 14, 2005 and completed on June 30, 2010. The project was financed by loans of the World Bank, funds of the Ministry of Communications and High Technologies, and grants of the Swiss organization SECO.
Under the project a new accounting plan was prepared with the technical assistance of the Central Bank of the Republic of Azerbaijan for Azerpost LLC and approved by the Ministry of Finance.The advisers from Dutch company FACP rendered assistance for the implementation of institutional building in Azerpost LLC, provided consulting services on various modules.At the same time, advisers of FACP company prepared market-oriented new structure of Azerpost LLC and by carrying out reforms in post branches and post offices of Azerpost LLC, the structure of Azerpost LLC was brought in conformity with the structure of organizations providing banking financial services.
In order to improve the legal framework, the Milli Mejlis (Parliament) adopted additions and amendments to the Law “On Postal Communication” of the Republic of Azerbaijan on 2 October 2008, and was approved by Presidential Decree № 17 of November 11, 2008.
Purchase of the Automated Corporate Information System (ACIS) of Azerpost LLC and installation of system, which is one of the most important components of the project, was successfully completed. Main Department of Azerpost LLC was fully automated at the first stage, then post branches and post offices located in Baku and regions were automated.As a whole, over 1,200 post offices have been automated. Connection of post offices to ACIS is currently underway.
Azerpost LLC has also been connected to the CBA’s payment systems AZIPS and SPSCS (Small payment settlements and clearing system), as well as international payment system SWIFT in order to provide new financial services. Besides that, correspondent accounts in foreign currency were opened in Citibank (U.S.), Raiffeisenbank (Austria) and Sberbank (Russia), on which international banking operations are being carried out now.
Several departments of Azerpost LLC have been connected to the international money transfer systems like Western Union, “Zolotaya Korona”, Contact and were put into use. At the same time, Azerpost started to issue both local cards and plastic cards by connecting to the processing center MilliKart LLC with a view to issue Azerpocht LLC’s plastic cards and integration into plastic cards market.
In accordance with the agreement (license) issued to Azerpost LLC by Central Bank of the Republic of Azerbaijan on April 10, 2010, all departments connected to ACIS started to provide most banking and financial services (opening and operation of accounts, money transfers, opening of correspondent accounts in financial institutions, as well as the Central Bank of the Republic of Azerbaijan, means of payment, including debit and credit cards, buying and selling of foreign currency at the customers’ request, collection of cash and other valuables ).
As a continuation of the financial services development project, the Republic of Azerbaijan: Swiss State Secretary for Economic Issues’ “Modernization Project of Financial Sector” between the Republic of Azerbaijan and International Bank of Reconstruction and Development, approved by order № 302 of the Cabinet of Ministers dated 14.11.2012, has been implemented. According to the requirements of the second module of the project, a grant in the amount of 600,000 USD (50,000 belongs to the World Bank) was allocated for staff training of Azerpost LLC, formation of its new image and conducting audits for 2011-2012. Projects have been implemented on each of the three components.
Azerbaijan Bank Training Centre won the tender on the project for staff training of Azerpost LLC and as part of the project, during the period from March 1, 2014 until August 31, 2015 a training capacity on postal and financial services was established in the LLC. A total of 44 instructors on 28 topics have been trained, of which 31 on 22 topics in the field of financial services, including 13 on 6 topics in postal services sphere. In addition, a total of 3643 employees participated in trainings during the period of the implementation of the project thanks to distance learning offered by LLC on 16 topics and created LMS portal.
Dutch company GUYDYON was the winner of the tender held for the reconstruction of the company’s image, and then AzEkoKonsaltinq. As part of the pilot project, the World Bank has chosen the city of Shirvan, the design of a new image of customer services department of regional post offices has been developed and the department has been overhauled according to the new design. Consultants conducted various surveys in Shirvan city to collect the necessary information on the branch, necessary evaluation work was carried out. Upon completion of the project in accordance with the requirements of technical specifications, initial version of the reports on brand strategy, market analysis, product analysis, sales plan, marketing plan and marketing strategy was prepared, and presented to the LLC.
Company KPMG became winner of the tender for the project audit for 2011-2012, and in accordance with technical specifications, the company completed the work in a timely manner , relevant report and an action plan were prepared and submitted to the LLC to take into account.
As a result of the work done, all necessary conditions were created for provision of quality public postal and financial services through Azerpost LLC’s network which covers the entire territory of the country.