37402 - Nelson

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Environmental & Social Review Summary

Project Number

37402

Company Name

NET 1 UEPS TECHNOLOGIES INC.

Date ESRS Disclosed

Apr 12, 2016

Country

South Africa

Region

Africa

Last Updated Date

Dec 1, 2016

Environmental Category

B - Limited

Status

Active

Previous Events

Approved : Mar 30, 2016
Signed : Apr 11, 2016
Invested : May 9, 2016

Sector

Retail Payment Points

Industry

Financial Markets

Department

Equity Portfolio Management

Project Description

This project involves a proposed equity investment by IFC and AMC of up to $100 million in Net1 UEPS Technologies, Inc. (“Net1” or the “company”). Net1 delivers welfare payments to more than 10 million people in South Africa, and offers a broad range of solutions that provide access to financial services for the un(der)banked, including mobile financial services and smart card technology designed for rural areas of Africa where there is limited infrastructure.

Net1 has leased spaces in 226 office buildings in South Africa. Light assembly of equipment is performed at only one of those spaces. Net1 operates a payment network for customers in South Africa, including approximately 800 stationary ATMs and 600 mobile ATMs, moved around on trucks. IFC’s investment will help to finance the company''s plans to expand within South Africa, and possibly to other countries in Africa and in other emerging markets. The company also has some operations in South Korea, but since it is a Part I country, those operations are not subject to environmental and social review by IFC.

Overview of IFC's Scope of Review

The review of this proposed investment consisted of appraisal of environmental and social (“E&S”) and technical information submitted by Net1, including training material on occupational health and safety, the company’s social and ethics committee charter, staff manual, grievance policy and procedure, employment equity plans, an agreement with Fidelity Security Services (PTY) Limited, and documentation on the company’s management of human resources, including an agreement with the South African Commercial, Catering and Allied Workers Union.

E & S Project Categorization and Applicable Standard

While all Performance Standards are applicable to this investment, IFCs environmental and social due diligence indicates that the investment will have impacts which must be managed in a manner consistent with the following Performance Standards. If IFCs investment proceeds, IFC will periodically review the the project’s ongoing compliance with the Performance Standards

PS 1 – Assessment and Management of Environmental and Social Risks and Impacts
PS 2 - Labor and working conditions
PS 3 - Resource Efficiency and Pollution Prevention
PS 4 – Community Health, Safety and Security
If IFC’s investment proceeds, IFC will periodically review the the project’s ongoing compliance with the Performance Standards
PS5, PS6, PS7 and PS8 are not considered applicable given that all sites will be leased; no operations are expected to affect biodiversity conservation or any management of living natural resources; no Indigenous Peoples are expected to be affected; and no important cultural heritage is expected to be impacted.

The key E&S issues associated with the project are in the health and safety of workers and local community members in relation to the development and operation of Net1’s network of stationary and mobile ATMs. As E&S risks and impacts are expected to be limited, site-specific, and relatively few in number, and it is possible to avoid or mitigate any limited adverse impacts that might result, the proposed investment has been classified as a Category B project according to IFC’s Policy on Social and Environmental Sustainability.

Environmental and Social Mitigation Measures

Stakeholder Engagement

Stakeholder Engagement Plan

Net1 recognizes the importance of stakeholder engagement, and is committed to comply with the requirements of IFC Performance Standard 1 on stakeholder engagement.

The South African Social Security Agency (SASSA) has taken responsibility for communicating with recipients of social grants regarding the availability of Net1’s mobile ATMs.

Net1 is committed to address any grievances expressed by local community members, notably in relation to the company’s operation of its stationary and mobile ATMs, and the conduct of contracted armed security guards. Net1 is committed to avoid or reduce any complaints or concerns from local community members regarding noise, security, and/or road safety.

Broad Community Support

Environmental & Social Action Plan

Net1(37402) Supervision Disclosure Snapshot – Version 2
Description	Anticipated Completion Date	Status	Comments	Completion Date
PS1: At least one qualified person will be nominated to be an Environmental and Social (E&S) coordinator for Net1.	11-Apr-2016	Completed	Completed	5/1/2016
PS1: Provision and implementation of E&S policies and procedures satisfactory to IFC, consistent with IFC Performance Standards and IFC Telecommunications Guidelines – to integrate pollution control, waste management, rehabilitation activities, road safety, emergency preparedness, life and fire safety, and monitoring/reporting, especially regarding the development, installation, operation, maintenance and repair of Net1’s stationary and mobile ATMs and associated vehicle fleet.	10-Jul-2016	Completed	Completed	11/21/2018
PS2: Provision and implementation of policies and procedures satisfactory to IFC, consistent with IFC Performance Standards – to ensure that workers are provided a safe and health work environment, including provision of appropriate training and equipment and reporting on key health and safety statistics.	11-May-2016	Completed	Completed	11/21/2018
PS3: Provision and implementation of policies and procedures satisfactory to IFC, consistent with IFC Performance Standards – to provide for waste management consistent with Section 1.6 of the World Bank Group General EHS Guidelines, and to provide for screening of automotive service providers for any significant environmental, health and safety concerns, including potential use of harmful child labor.	11-May-2016	Completed	Completed	11/21/2018

**Information on IFC's Policy and Performance Standards on Environmental and Social Sustainability can be found at www.ifc.org/sustainability

IFC supports its clients in addressing environmental and social issues arising from their business activities by requiring its real sector clients to set up and administer appropriate grievance mechanisms and/or procedures to address complaints from Affected Communities in relation to environmental and social issues arising from IFC's clients' business activities. Since 2012, IFC's Financial Intermediary clients applying the Performance Standards are required to develop External Communications Mechanisms to receive and review inquiries or complaints from any interested party regarding the E&S risks and impacts of their operations.

For IFC projects that are active or under consideration, individual(s), or their authorized representative(s), who allege they have been or will be adversely affected by E&S risks or impacts arising from IFC's clients' business activities, may submit a complaint to IFC directly for consideration. When receiving an E&S complaint, IFC engages with complainants and works with its clients to find solutions to E&S concerns as quickly and efficiently as possible.

Complaints can be submitted to IFC online at www.ifc.org/escomplaints or by email to EScomplaints@ifc.org.

IFC complaint response is separate from and complementary to IFC’s clients’ project level grievance mechanisms and IFC’s Independent Accountability Mechanism (CAO). Lodging a complaint directly with IFC does not, at any time, restrict access to CAO.

Affected communities have unrestricted access to the Compliance Advisor Ombudsman (CAO), the independent accountability mechanism for IFC and MIGA. CAO facilitates the resolution of complaints related to IFC and MIGA projects and sub-projects, undertakes reviews of IFC’s and MIGA’s environmental and social compliance, fosters public accountability for their commitments, and enhances the environmental and social performance of IFC and MIGA.

Independent of IFC and MIGA management and reporting directly to the IFC and MIGA Boards of Executive Directors, CAO helps resolve issues raised about the environmental and social impacts of projects through a neutral, collaborative, problem-solving approach via its Dispute Resolution function. It also reviews IFC’s and MIGA’s compliance with environmental and social policies, assesses related harm, and recommends remedial actions through its Compliance function. Additionally, CAO provides advice to IFC, MIGA, and their Boards to enhance environmental and social sustainability performance and minimize the risk of harm.

Complaints may relate to environmental and social harm regarding any aspect of the planning, implementation, or impact of a project or sub-project, and can be made by any individual, group, community, entity, or other party affected or likely to be affected by the environmental or social impacts of an IFC- or MIGA-financed business activity.

Complaints can be submitted by any of the following methods:

Online form: available at https://www.cao-ombudsman.org/
Mail/Hand Delivery to: 2121 Pennsylvania Avenue, NW, Washington, DC 20433, USA
Voice mail: +1 202 458 1973
Email: cao@worldbankgroup.org
SMS, WhatsApp, Telegram, and Signal: +1 202 650 2627

CAO receives and addresses complaints in accordance with the CAO Policy, which can be accessed at: https://www.cao-ombudsman.org/policies-guidelines.

This Environmental and Social Review Summary (ESRS) is prepared by IFC to disclose its findings and recommendations related to environmental and social considerations regarding potential investments. Its purpose is to enhance the transparency of IFC's activities. For any project documentation or data included or attached herein, whether prepared by the project sponsor or otherwise, authorization has been given for public release by the project sponsor. IFC considers that this ESRS is of adequate quality for release to the public, but has not necessarily independently verified all of the project information therein.
It is distributed in advance of IFC Board of Directors' consideration and may be periodically updated thereafter. Board dates are estimates only and this document should not be construed as presuming the outcome of the Board Directors’ decision. The following ESRS is disclosed in accordance with IFC's Access to Information Policy (AIP).

The map is for illustrative purposes and does not imply the expression of any opinion on the part of the World Bank, concerning the legal status of any country or territory or concerning the delimitation of frontiers or boundaries. Country borders or names do not necessarily reflect the World Bank Group's official position. In some cases, available project location information is limited to the country of the project's activities. Locations are approximate.

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Environmental & Social Review Summary

Project Description

Overview of IFC's Scope of Review

E & S Project Categorization and Applicable Standard

Environmental and Social Mitigation Measures

Stakeholder Engagement

Broad Community Support

Environmental & Social Action Plan

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Environmental & Social Review Summary

Project Description

Overview of IFC's Scope of Review

E & S Project Categorization and Applicable Standard

Identified Applicable Performance Standards

Environmental and Social Categorization and Rationale

Environmental and Social Mitigation Measures

Environmental and Social Mitigation Measures

PS 1: Assessment and Management of Environmental and Social Risks and Impacts

PS 2: Labor and Working Conditions

PS 3: Resource Efficiency and Pollution Prevention

PS 4: Community Health, Safety and Security

Stakeholder Engagement

Stakeholder Engagement

Local Access of Project Documentation

Broad Community Support

IFC's Determination of BCS

Environmental & Social Action Plan

Environmental & Social Action Plan

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