The Credit Information Unit (CIU) of the Bank of Mongolia (BOM) has been continuously striving to maintain consistent and secure operations of the credit information database. In this regard, the CIU has undertaken a number of activities including upgrading the database hardware under the Strengthening Fiscal and Financial Stability Project (SFFSP) financed by the World Bank and improving regulatory environment of the credit information system of Mongolia.
Upgrading and modernizing the technical capacity of the credit information database:
Since the banking system of Mongolia has shifted to a two-tier system, Mongolia has been continuously working on implementing a risk management mechanism for banking and financial sectors that is on par with the international best practices. Among such known mechanisms, the most effective and low-cost risk management tool is developing a credit information framework. As such, the BOM has been operating a credit information database at no cost since 1996.
The current functions of the CI system are two-fold: consolidating credit data from the partnering agencies and disseminating the credit information on 24/7 basis. Therefore, it is detrimental to provide CI system with up-to-date software and hardware in order to ensure its consistent and secure operations.
In 2019 and 2020, the SFFSP financed procurement of servers, firewall and optical switches to safeguard the CI database and its steady operations. These devices are fully incorporated into the CI hardware system.
Improving the legal environment governing the CI system:
In an effort to implement the Law on Credit Information passed by the Parliament of Mongolia on October 20, 2011, the BOM Governor approved regulations on licensing agents on conducting credit information service, and credit information database confidentiality and security in 2019 and 2020. In addition to these, the BOM has re-approved the updated “Regulation on Credit Information” that aims to ensure continuity of the database operations until private agents are licensed or if licenses are revoked.
Thanks to the technological upgrade financed by the World Bank-financed SFFSP, the number of errors and malfunctions in the CI database operations has significantly decreased. Moreover, the current CI hardware capacity enables cross-checking of the CI data and the General Authority for State Registration database stored at the National Data Center, which provides individuals and entities an opportunity to access their credit information data through ‘e-Mongolia’ online system.
WORLD BANK WORKING GROUP MET WITH PIU AND IMPLEMENTING ORGANIZATIONS REGARDING THE COMPLETION REPORT OF THE STRENGTHENING GOVERNANCE IN MONGOLIA PROJECT
Concerning the Strengthening Governance in Mongolia project, which was completed on February 28, 2023, the World Bank working group to develop the project completion report had an official meeting with Project Implementation Unit (PIU) and implementing organizations on March 30, 2023. The purpose of the working group meeting is to review the implementation of the project, the results achieved, and the fulfillment of the project indicators.
PERFORMANCE BASED FINANCING: INSPIRING NEW APPROACHES TO PUBLIC FINANCIAL MANAGEMENT IN HEALTH AND EDUCATION
Performance based financing (PBF) links funds or payments to service providers to results achieved and gives them considerable autonomy in the use of these funds. The strategic approach is appealing to many individuals and organizations as it motivates them to perform better and channels resources directly to the frontlines. This in turn fosters greater accountability. Using this approach has been popular in different sectors with some promising results emerging.
AN INTEGRATED SYSTEM FOR RESULTS-BASED MEDIUM-TERM BUDGET PLANNING: IN ACHIEVING THE GOALS OF IMPROVING BUDGET PLANNING, BUDGET EFFICIENCY AND PROGRAM OUTCOME.
Under the scope of improving public financial management, Mongolia is aiming to introduce result-oriented medium-term budgeting, transitioning from the traditional input-based budgeting. This goal is aligned with development policy of Mongolia to shift from medium-term fiscal framework (MTFF) to medium-term expenditure framework (MTEF).
The MOF is entering the new phase of PFM Reform Action Plan
Within the framework of the European Union financed, World Bank managed “Strengthening Governance in Mongolia” project, the Ministry of Finance, in compliance with the “Sustainable Development Vision 2030” and the “Action Program of the Government of Mongolia for 2016-2020”, has approved and implemented the Public Financial Management (PFM) Reform Strategy and the Action Plan for 2018-2022. The overarching objective of the strategy was to improve governance and achieve effective resource allocation and efficient public service delivery. The implementation status of the PFM Action Plan is indicated as “Certain results have been achieved” at the rate of 85 percent.
LAUNCHED BETA VERSION OF THE REDEVELOPED GLASS ACCOUNT PORTAL
The Ministry of Finance Mongolia has developed and successfully launched the new version of the Glass Account Portal in 2023 within the framework of the Strengthening Governance in Mongolia Project jointly implemented by the EU and the World bank.
New systems and services are added in the Intermediate service platform for fiscal and financial systems
The Ministry of Finance Mongolia has developed and successfully launched the Intermediate Service Platform (ISP) in 2022 within the framework of the Strengthening Governance in Mongolia Project. The main purpose of the system is to provide a possibility of information /web services/ exchange between the independent systems of the Ministry of Finance and other organizations in a easy and flexible way. In addition, it is solving the issues of overlapping connections and development between many information systems and organizations, transferring them to a unified standard, making it has no complexity, and more secure.