Request for Proposal for Portability of digital identification as an enabler to cross-border payments and international remittances: Literature Review and Expert Interviews

Portability of digital identification as an enabler to cross-border payments and international remittances: Literature Review and Expert Interviews UNCDFs Migration and Remittances for Development Programme aims at contributing to sustainable development by making remittances more accessible and affordable while helping build resilience for migrants and their families. For both sending and receiving countries, the Programme seeks to increase the share of migrant remittances flowing through formal channels, thereby giving policymakers at both ends greater understanding of the true picture of inbound and outbound financial flows. For remittances service providers, the Programme seeks to build the capacity to understand the financial needs and preferences of migrants and their families, and to design and deliver responsive products accordingly. For migrants, the Programme aims not only to lower the costs and increase the safety and convenience of sending money, but also to link remittances to a broader suite offinancial services, including insurance, savings, pensions, investments, and credit, that can help them reach their goals. The Programme recognizes digitization as the key to achieving these objectives. In March 2021, UNCDF endorsed the 10 principles for digital identification, facilitated by the World Bank ID4D. This marks an important step for UNCDF efforts in advocating for and building Open Digital Payment Ecosystems, starting with having strong identification systems in place. Currently, UNCDF is engaged in several projects linked to digital identification, including: the feasibility study on setting up a unique identification system for financial service users in the WAEMU, commissioned by the Central Bank of West African States (BCEAO). This work will consider other initiatives on digital identification in the WAEMU such as Wuri and ID4D (Migration and Remittances); the identification landscape assessment in ECCASand IGAD countries, as part of the regional harmonization of remittances in these regions (Migration and Remittances); the national identification system policies and regulations assessment in Senegal, Nepal, Myanmar, Ethiopia and Bangladesh as part of the countries assessment framework (Migration and Remittances); country diagnostics for Fiji, Vanuatu and Solomon Islands on E-KYC and Credit Reporting (Pacific Programme). Throughout these engagements and discussions with industry experts, it was clear that the current implementation of digital identification systems is relatively effective at the national level but poorly effective at cross-border level, with few successful initiatives such as the European Union e-IDAS system. In Africa, the African Union is in early stages with its digital ID interoperability framework initiative. Since identification is one of the core building blocks for end-to-end digitization of remittances, it is of paramount importance to gain a better understanding of challenges and learnings linked with cross-border and portability of identification systems. UNCDF is looking for a consulting firm to explore how the portability/interoperability of digital identification can be leveraged to improve the onboarding of international migrants on digital channels, towards end-to-end digitization of international remittances and risk-based access to migrant-centric financial products. For more information on the RFP and the application process please refer to the RFP document attached.