Direct Payments

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Programme and Project Management
Crisis Response
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Programme and Project Management

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Home
Financial Resources Management
Financial Management and Implementation Modalities
Harmonized Approach to Cash Transfers (HACT)
Direct Payments

Main navigation

Inventory Management
- Inventory Management
Cash Banking and Investment
Financial Closure of Development Projects and Trust Funds
Financial Management and Implementation Modalities
Financial Operations Management
- Corporate Operations and Information Management
- Statutory Financial Reporting
Pipeline and Revenue Management
Expense Management
Resource Planning and Cost Recovery
Working with External Auditors
- Working with External Auditors

Focal Point

Adam Phillion, Catherine Muli, Kanesh Babu Letchumanan

Effective Date

29/01/2021

Planned Review Date

29/01/2027

Version

10.0

Latest updates

January 03, 2025 - The Direct Payments policy has been updated in paragraphs 2, 4 and 6 to clarify the funding requirements for the full costs of processing direct payments and providing support services. p tag used here for line break July 09, 2024 - The following clarification and editorial updates have been implemented:

January 03, 2025 - The Direct Payments policy has been updated in paragraphs 2, 4 and 6 to clarify the funding requirements for the full costs of processing direct payments and providing support services. p tag used here for line break

July 09, 2024 - The following clarification and editorial updates have been implemented:

Direct Payments procedure: The link to the Face form has been included in Step 1 of the procedure. Additional clarity for the approval of the completed FACE form has also been added.

p tag used here for line break

February 21, 2024 - The policy and the procedures have been updated to reflect the following changes:

Revision to approval requirements for direct payments in non-local currency has been added in paragraph 9 of the policy, where non-local currency payments to international suppliers engaged in line with the Letter of Agreement (LOA), the Responsible Party Agreement (RPA), the Performance Based Payment Agreement (PBPA), or similar contracts or agreements, as well as the project document or the annual work plan will be approved by Head of Office provided the contractual documents specify disbursements in non-local currency.
Seeking UNDP HQ Treasury’s approval before non-local currency disbursement are made has been removed in paragraph 9 of the policy in line with the new changes to paragraph 9.
The explanatory notes in step 7 of the procedure have been updated to reflect the changes in the policy.

p tag used here for line break

December 28, 2023 - The changes made are to provide additional clarification on HACT transaction processing in Quantum and references to available reports relevant for management of HACT balances. p tag used here for line break

June 02, 2023 - The policy and the procedures have been updated to reflect UNDP’s transition to its new cloud-based management platform Quantum in January 2023, replacing its previous ATLAS system. p tag used here for line break

January 29, 2021 - The updated Direct Payments policy is now available. The summary of the major changes and their implication on UNDP Offices are as follows:

- Clarification has been made in para 2 that direct payments must be performed through an approved FACE form, requesting UNDP to make payment directly to the vendor on behalf of the Partner, and the Implementing Agent code must be the Partner’s code;

- Clarity has been added for non-local currency denominated payments to national implementation projects in para 8 which should be submitted to UNDP HQ Treasury for appropriate approval in accordance with UNDP Financial Regulations and Rule 125.06;

- Clarification has been added on reviews of FACE form, including the list of red flags in para 12 and 13 that potential signs of fraud or misuse of funds shall be observed, reviewed, investigated and documented. Direct payment should not be processed until the potential red flags are fully investigated and confirmed to be valid;

- Procedures offices should take to address unsupported payments reflected in assurance reports, including audits and spot checks, has been added in para 14. p tag used here for line break

January 29, 2021 - The Direct Payments policy and procedures have been further updated as follows: Guidance has been added to Para 2 on the ICE template. ICE template guidance has been added to procedure step 1. Fraud red-flags guidance have been added to procedure step 9. p tag used here for line break

November 16, 2018 - The Direct Payment policy is available in French. To access the document, click on the French language tab. p tag used here for line break

April 06, 2018 - The Direct Payment policy is now available in Spanish. To access the document, click the Spanish language tab. p tag used here for line break

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Relevant Regulations and Rules

UNDP Financial Regulations and Rules

Policies

Main Policy

Direct Payments

DOCX (82.15 KB)

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Procedures

Related Procedures

1

Step

Send signed FACE forms with copies of supporting documents as necessary to UNDP, including the ICE template. Maintain all original supporting documentation.

Responsible Party

Partner

Template/Guideline

UNDP Itemized Cost Estimate (ICE) Template

FACE form Template

Explanatory Notes

Since the partner is responsible for procurement copies of supporting documentation are only supplied when specifically requested by UNDP (when a greater degree of oversight is deemed necessary).
The FACE form signed by the designated official is the supporting documentation used by UNDP to process payment.

2

Step

Ensure signature on the FACE form matches with the record of partner authorized signatures.

Responsible Party

UNDP Programme Officer

Template/Guideline

Explanatory Notes

Internal control—first approval

Note that as the procurement has been performed by the partner, the transaction for UNDP begins with Quantum Accounts Payable (AP) module Invoice regardless of amount.

3

Step

Review request and background documents where applicable for reasonableness and consistency with the project budget and annual work plan

Responsible Party

UNDP Programme Officer

Template/Guideline

Explanatory Notes

4

Step

Confirm that request is within the available Quantum project budget and available resources.

Responsible Party

UNDP Programme Officer

Template/Guideline

Explanatory Notes

Report (PowerBI) and Quantum Project Budget Balance Report can be used to monitor the reported Partner expenditures and budgets.

5

Step

Ensure supplier name, address and banking details are supplied.

Responsible Party

UNDP Programme Officer

Template/Guideline

Explanatory Notes

Periodically review the supplier master file to avoid duplication of suppliers.

6

Step

Verify that the supplier is authentic, is not on the UN Security Council 1267 Committee's list of terrorists and terrorist financiers, and is not on the UNDP list of suspended and removed suppliers.
If the supplier does not already exist, create and approve the supplier profile in Quantum.
If the Quantum external access facility is used, then the partner creates the supplier profile and the accounts payable (AP) invoices. Before approving the supplier and payment invoice, UNDP verifies the supplier.

Responsible Party

Buyer/supplier maintenance officer [level approver]/GSSC Approver

Template/Guideline

Explanatory Notes

Check the Lexis-Nexis dashboard to confirm if the supplier is listed in the sanctioned list, and if so the Office will need to contact Vendor Review Committee(VRC) for advise on how to proceed with the pending payments due to the sanctioned supplier

7

Step

If all is in order, the FACE form shall be approved by the Head of Office, accept the payment request and raise invoice in Quantum AP module; sign and submit it to the approving officer.

Responsible Party

UNDP Programme Officer,

UNDP CO Approver

Template/Guideline

Explanatory Notes

Direct Payments shall only be made in local currency. Requests for non-local currency payments should be submitted to UNDP HQ Treasury for appropriate approval in line with POPP.

When the project document or the annual work plan have clearly identified activities and expenditures to be incurred in non-local currency, UNDP HQ Treasury approval is not required.

All such cases should be approved by the Head of the Office.

Offices should submit to GSSC the necessary supporting related to non-local disbursement.

8

Step

Reject payment request where results of review are not satisfactory.
Communicate with the partner to resolve contentious matters.

Consider any other knowledge that should prevent payment by UNDP i.e., fraud red flags, and seek adequate explanation as appropriate.

Responsible Party

UNDP CO Approver

Template/Guideline

Explanatory Notes

9

Step

Review Quantum Invoice, FACE forms and supporting documents for consistency and proper authorization (i.e., signed by authorized official).

Responsible Party

GSSC Second Approver

Template/Guideline

Explanatory Notes

Internal control—second approval

10

Step

Disburse funds. See POPP: Disbursing Funds

Responsible Party

Template/Guideline

Explanatory Notes

Internal control—third approval

11

Step

Inform partner when payments are made.

Responsible Party

UNDP Programme Officer

Template/Guideline

Explanatory Notes

12

Step

Reject the expense where information becomes available that questions the appropriateness of direct payments already made.

Responsible Party

UNDP Programme Officer

Template/Guideline

Explanatory Notes

In Quantum, expenses recorded from direct payment are reversed in the Quantum AP module and a corresponding accounts receivable is recognised in GL account 14095 Non-Staff Receivable - Miscellaneous. .

United Nations
Development Programme

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