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Poor access to drinking water is a major problem in rural

Tanzania. New water points are being constructed but

sustainability remains a common challenge. The 2015

national water point mapping survey (Minstry of Water,

Tanzania) found that out of 86,946 rural water points, only

54 per cent were functional, 7 per cent needed repair,

and 39 per cent were non-functional. As a result, about 50

per cent of people in rural areas of Tanzania do not have

access to safe drinking water. Failure of rural water supply

has many causes. Most rural water schemes have failed

because of poor operations and maintenance attributed

to low-cost recovery or revenue management (Whaley

and Cleaver 2017).

Prepaid water systems have attracted significant

attention in Tanzania and are considered a game

changer in ensuring sustainability of rural water

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PERFORMANCE OF PREPAID WATER SYSTEMS IN RURAL TANZANIARESEARCH BRIEF

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services in the country. The management of these

prepaid systems has been strengthened with the

formation of Community-Owned Water Supply

Organisations (COWSOs) covering over 1,400 villages.

Prepayments by water users ensure that resources

are available to operate and maintain the system.

In addition, mobile payment systems and digital

technologies have been introduced to enhance the

ease of payment and to reduce non-revenue water

(un-accounted water).

Different models of the prepaid water systems are being

piloted by national and international organisations.

These include the eWater system in Babati and Arusha

districts supported by DFID through a consortium led

by WaterAid, and the HDIF-funded Grundfos AQtaps

model in Karatu district, and Susteq in Kishapu district.

Although all these technologies are very promising and

have brought several advantages, what has not been

clear is the extent to which the prepaid water systems

have contributed to the sustainable delivery of inclusive

and safe water services in rural Tanzania.

This summary presents the key findings of research commissioned by HDIF, in partnership with DFID, to look into these prepaid water systems and analyse their effectiveness to date. The overall question for this

study was: To what extent do the prepaid water systems

contribute to the sustainable delivery of inclusive and safe

water services in rural Tanzania?

The study explored the operational sustainability of the

selected prepaid water meters, the use of prepaid water

meters by different population groups, the challenges

of rural water supply, and which of these challenges

are being addressed by current prepaid water systems.

Moreover, the study unpacked the overall contribution of

the prepaid water systems in improving the sustainability

of rural water supply in Tanzania. The study’s objectives

were to:

• Explain the types of prepaid water systems being

piloted through a situation analysis, using secondary

literature and key informant interviews.

• Describe the technologies currently being used to

deliver prepaid water systems in terms of both their

similarities and differences.

• Review and explain the type of management and

business models attached to the existing prepaid

water systems, especially the relationship between

the COWSO, village committees, and district-level

water office.

• Summarise the typologies, strengths, and weaknesses

of the prepaid water systems currently operational in

Tanzania.

Why pay for water?

In a country like Tanzania, where almost 50 per

cent of water points are broken or abandoned

and almost half of the population lacks access to

clean water, rural communities need cost-efficient,

locally adapted innovations that can help improve

the reliability of water services and provide a more

sustainable water infrastructure. Prepaid water

systems enable users to pay digitally in advance

and collect regular water from a water kiosk.

National surveys of 19 sub-Saharan African

countries in 2008–09 found that only 30 per cent

of rural households pay for water, while payments

are more regular where the water supply is reliable

(Foster and Hope 2017). The general conclusion

from several studies is that pay-as-you-collect

systems and approaches are much better for

sustainability of rural water schemes (ibid.).

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The systemsPrepaid water system in Kishapu district

In Kishapu, the prepaid component is based on a

technology developed by Susteq, a Dutch company

based in the Netherlands, and implemented by Investing

in Children and Societies (ICS). The technology consists

of a water point, a kiosk (where the water point is), a shop,

digital water tags, an application programming interface

(API) for mobile money transfers, a database, and a

dashboard for system monitoring and reports generation.

The water is delivered at an unstaffed water point.

Users can collect water at any time

of the day via water credit cards

topped up via their mobile phones

or from licensed credit sellers. 

Using a grant from HDIF, ICS

designed and implemented the

prepaid system in partnership

with Kishapu District Council

and the local water authority,

Maganzo Water Supply

and Sanitation Authority

(MAGAWASA). Susteq provides

the technology, carries out

system updates, and manages

the back-end of the dashboard

system from the Netherlands. ICS

water engineers and technicians

are responsible for monitoring

the day-to-day operation of the

system. MAGAWASA has the

responsibility of running the

system locally, and for purchasing

the water in bulk from Kahama

Shinyanga Water Supply and

Sanitation Authority (KASHWASA),

storing it in two overhead tanks,

and distributing it through the

prepay arrangement.

RESEARCH BRIEF PERFORMANCE OF PREPAID WATER SYSTEMS IN RURAL TANZANIA

Happy girl in Kishapu.

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Water point in Kishapu.

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RESEARCH BRIEF PERFORMANCE OF PREPAID WATER SYSTEMS IN RURAL TANZANIA

Women fetching water at E-Water point in Babati, Sangara Village.

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Prepaid water system in Karatu district

The second prepaid water system studied is

implemented in Karatu by Catholic Relief Services

(CRS). The water is supplied through staffed

water kiosks (also referred to as ‘water ATMs’ and

‘water distribution points’). The water supply

system comprises two deep boreholes fitted with

solar pumping systems, elevated storage tanks,

transmission and distribution networks, and water

kiosks. Users buy a ‘smart card’, which is loaded with

water credits bought through kiosk operators

and used to access the water.

The day-to-day management of the system

is the responsibility of two local water

authorities: Karatu Village Water Supply

(KAVIWASU) and Endamarariek/Endabash

Water Supply (ENDAWASU). These authorities

are also responsible for setting water tariffs (upon

consultation with the Energy and Water Utilities

Regulatory Authority (EWURA)), collecting

revenue, and employing the kiosk operators.

Prepaid water system in Babati and Arusha districts

eWATERpay is implemented by a consortium led by WaterAid in Endanachan and Gidewari villages in Babati district. The system has

also been piloted in some areas of Arusha District Council. The system is a cheap, simple technology through which users can purchase credit using the eWATERapp on smartphones, through mobile money, or by receiving a remote gift via PayPal. The system provides live monitoring of each tap and operators can track and detect faults, thus allowing for efficient and timely operations and maintenance. The systems are implemented in partnership with the local COWSOs.

A token used by E-Water users to get water.

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Key findings• Prepaid water systems improve revenue collection

processes, which is an important requirement for

the sustainability of the systems. The certainty of the

revenues enhances the confidence and ability of

the local authorities to invest in the system, appoint

the staff, and to reach out to the users. Before the

introduction of prepaid water meters in Kishapu

and Karatu areas, water supply was not reliable,

the management of existing water points was not

effective, and the revenue collected was far less

than it should have been. The prepaid water system

has changed this situation as

it allows for better collection

and management of revenues,

which provide resources for the

repair and maintenance of the

system. The investment made

on the water system, combined

with effective operations and

maintenance, has resulted in

regular water supply to the users.

• Prepaid water systems are an effective and efficient way of collecting water tariffs and

offer a high level of convenience

to both the users and local

water supply authorities.

They save time and do not

require unnecessary paperwork.

Moreover, the systems minimise

cash transactions and, therefore,

contribute to the transparency

of the tariff collection.

• Prepaid water systems provide better value for money. The

majority of residents in the

project areas have used the

installed prepaid water systems

and have not raised any major

concerns over the price of water.

Maganzo village, for example,

did not have a reliable water supply system before

the project that was implemented by ICS with HDIF

support. The prepaid water system installed by ICS

has significantly contributed to improving access

to safe water in an area previously not served. It has

also reduced the price of water by more than half. All

households that were interviewed expressed a high

level of satisfaction with the prepaid water service.

• New businesses and livelihoods opportunities

around the supply of water have emerged. The

systems have led to a range of economic opportunities

including jobs for e-credit sellers and water vendors,

RESEARCH BRIEF PERFORMANCE OF PREPAID WATER SYSTEMS IN RURAL TANZANIA

A lady fetching water at ICS water point in Kishapu, Maganzo village, Shinyanga.

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many of whom have set up shops within the water

kiosks to earn extra income. Paulina, for example, is a

water kiosk operator in Karatu making the most of the

opportunity. Her kiosk is full of water storage drums,

and when water is not available at the kiosk she uses

her stored water for watering her livestock, and for

irrigating her vegetables, which she later sells to local

restaurants.

• Prepaid water systems generate real time data on water collection by users, tariffs collected from users, and water point functionality. Key

data on water flow rates and pressure are used for

monitoring the system and are helpful evidence for

future planning.

• The use of solar energy can significantly improve the reliability of water stations. The prepaid water

system installed in Karatu piloted the use of solar

energy for pumping water and for charging the system.

The results show that using solar power increases

the reliability of water supply. Moreover, despite a

higher initial cost, solar power has significantly lower

recurring costs than other power sources.

• Prepaid water systems and water dispensers are not a problem-free solution, yet many of the present

challenges may be overcome as the technology is

further developed and is tested. For example, the

system installed by CRS and eWaterpay currently does

not support multiple taps, nor does it operate well

when the water pressure is low. On the other hand,

Susteq technology installed by ICS in Maganzo can

handle multiple taps, although this aspect is yet to

be implemented.

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A boy child heading to the water point in Maganzo village, Shinyanga.

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RESEARCH BRIEF PERFORMANCE OF PREPAID WATER SYSTEMS IN RURAL TANZANIA

RecommendationsLocal water authorities should invest in better revenue management systems. Prepaid water systems

improve overall revenue collection and management,

making it possible to reinvest part of the profits back

into the system. However, for this reinvestment to be of

value, local authorities need to improve their priority-

setting and decision-making processes on how the

generated profits are used. Specifically, this study found

that better financial analysis is needed at the local level

to inform decisions on whether to reinvest the profits on

(a) system expansion in the same geographical locations;

(b) system scale-up in new geographical locations; (c)

current systems consolidation; or (d) capacity-building

of staff.

Local water authorities should develop partnerships with technology providers that are independent from the project’s INGO implementers. These unaided

partnerships are crucial in sustaining and scaling up the

prepaid water meter systems. Among other things, this

means agreeing on and enforcing software licensing

agreements, protocols on data management and

sharing, and the use of future warranties; as well as

understanding the technology provider’s role and

responsibilities during and after the installation of

prepaid water meters (including after-sale services by

technology providers).

Use generated data on issues such as water collection, repairs, and seasonal demands as evidence for future planning. Prepaid water systems generate important

data, which could be used to inform future activities and

investments. Within the pilot projects, these data were

only used marginally to understand trends in revenue

collection.

COWSOs should commit to data privacy. As with other

data management systems, prepaid water systems raise

questions about the ownership and sharing of data. A

high-level discussion facilitated by HDIF in 2019, and

which involved key stakeholders in the country’s water

sector, deliberated over this issue and agreed that the

ownership of users’ data is the users themselves. This

data can be managed by the COWSOs but should

not be shared publicly unless there is approval from

the user. Other non-user-identifying data, such as

aggregated amount of revenues collected per meter,

will be managed by the COWSOs and can be shared at

its discretion.

Introduce lifeline water tariffs for the poorest. Two

of the three systems studied operate on a flat tariff and

do not provide effective options for the poorest and

most marginalised members of communities to access

water at cheaper prices. There is a need for authorities

managing these systems to identify ways to set lower

tariff rates and introduce lifeline water volumes for

those who otherwise cannot afford them. In addition,

the water tariffs are set up in consultation with EWURA,

a national level regulatory organisation. These tariffs

are usually based on a community consultation and a

comparison of tariffs in other regions. The tariff-setting

procedure needs greater clarity and should consider

key factors such as affordability, investment made, and

operations and maintenance needs.

Involve private sector partners in developing supply

chains of spare parts.

E-Water point in Sangara Village, Babati.

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References

Whaley, T.L. and Cleaver, F. (2017) ‘Can “Functionality”

Save the Community Management Model of Rural Water

Supply?’, Water Resources and Rural Development 9.56: 66 

Foster, T. and Hope, R. (2017) ‘Evaluating Waterpoint

Sustainability and Access Implications of Revenue

Collection Approaches in Rural Kenya’, Water Resources

Research 53.2: 1473–1490.

Acknowledgements

Report authors: Dr Hans C. Komakech, Nelson Mandela

African Institutions of Science and Technology (NM-AIST);

Dr Mansoor Ali; and Muzafar Kaemdin, HDIF-Palladium.

The opinions expressed in this briefing are those of

the authors and do not necessarily reflect the views of

DFID. Acknowledgement and quotes to be referenced

as follows:

Komakech, H.C.; Ali, M. and Kaemdin, M. (2019)

‘Assessing the Performance of Prepaid Water Systems

in Rural Tanzania’, HDIF Research Briefing, Dar es Salaam:

Human Development Innovation Fund

PO Box 76724 | Plot 436 Block 11 | TCRS Building, 2nd Floor Mwai Kibaki Road / Kiko Avenue | Mikocheni Area Dar es Salaam | Tanzania | East Africa Email: info@hdif-tz.org | Phone / Fax: +255 22 270 1542

www.hdif-tz.org @HDIFtz www.facebook.com/HDIFTanzania HDIF Tanzania

Managed by Funded by

ConclusionThe research has found that prepaid water systems are a

potential game changer in the sustainability of rural water

service delivery in Tanzania. They can create a transparent

system for revenue collection and management. They are

also inclusive, in that nearly anyone with a water card can

use it with minimum guidance and support. However,

these systems are not a panacea for all the problems

concerning rural water supply. There is currently so much

focus on the technical aspect of the innovation (the kiosk,

tags, pipes, etc.) that insufficient investments are being

made into the management model or better use of the

generated data.

The long-term sustainability of the rural water supply is

strongly dependent on the business model adopted. In

both Karatu and Kishapu, the capacity of the water utility

or COWSO to plan and manage the water project will

determine its sustainability. At present, it is not clear if

the utilities or COWSOs can make such long-term plans.

We conclude, therefore, that further efforts need to be

put into the business models underlying the prepaid

water systems.