CALL FOR PROPOSAL NO. ADD 2272/2023
Insurance product development for Character Referencing among Women and Youth Job Seekers in Addis Ababa, Livelihood Improvement for Women and Youth (LIWAY) Program Funded by Sida
This Request for proposal (RFP) is an exclusive, confidential, proprietary property of LIWAY Program (represented by Mercy Corps). It may not be copied, transmitted, or disclosed by any means without the express written consent of LIWAY Program (represented by Mercy Corps).
By accepting a copy hereof, recipient agrees to:
1) Be bound by the terms and conditions contained herein (including but not limited to the confidentiality provisions)
2) Use the RFP (and any related documents) solely for evaluation purposes and for responding to this RFP and
3) Return or destroy the RFP (and any related documents) LIWAY Program (represented by Mercy Corps)’s request or upon your decision not to respond to this RFP.
I. Introduction
LIWAY is a nine-year program (July 2017 to June 2026) funded by the Swedish International Development Cooperation Agency (SIDA) and the Embassy of Kingdom of the Netherlands (EKN). The program is implemented by a consortium of partners composed of SNV Netherlands Development Organization, Mercy Corps, Techno Serve, and Save the Children International. LIWAY aims to contribute to sustainable poverty reduction and social stability in Addis Ababa by increasing incomes through improved wages and self-employment opportunities, primarily for poor women and youth. The objective is to increase the incomes of 257,000 poor people in Addis Ababa, of which at least 128,500 (50%) are women (young and adult) and 192,750 (75%) are youth (female and male).
Mercy Corps is leading a Labor Market System, where labor information exchange infrastructure, childcare/domestic duties and referencing (risk & trust) are identified as intervention areas through a diagnostic study in the labor market system to address key constraints which greatly affected the participation of women and youth in the market. Under this diagnostic study, it was indicated that information on available jobs and matching services focusing on semi-skilled and unskilled job opportunities is scarce and difficult to find in Addis Ababa. Competition for work is very high, and this is accentuated by rural-urban migration compared to other cities in Ethiopia. To this end, LIWAY planned to design and pilot an intervention which promotes market-based solutions & incentives that enable actors in the core market functions to improve business performance that create increased employment opportunities for urban women and youth in partnership with private implementing partners on cost share basis.
II. Rationale/Problem Statement
LIWAY aims to address major systemic constraints impeding women and youth from accessing employment opportunities and better paying jobs in Addis Ababa City. According to Central Statistics Agency 2016, the overall youth unemployment rate in Addis Ababa was 24.4% of which female youth experienced higher rate of unemployment (29.8%) than males (16.9%). The issue of character referencing, usually considered as trust, are particularly difficult to migrants from rural areas to Addis Ababa for many reasons. This group have no access to the socially accepted form of referencing that allows them access to both formal and informal labor markets. The character references commonly provided by permanent residents with Addis Ababa ID cards and permanent addresses are often not available to migrants and so they find both the quantity and quality of work restricted. Most employer companies’/outsourcing companies requires character reference as a precondition for recruitment. Due to the pervasive challenges in getting character references, women & youth job seekers, particularly migrants were obliged to work as a daily laborer to secure their daily subsistence. It was also reported that majority of these job seekers are aware of the importance of insurance services and are willing to use insurance products as a replacement of character referencing if it is readily available.
Thus, to propose a business model that fits and best suits LIWAY target groups (specifically youth and women without Addis Ababa ID) and valuable inputs to influence government policy Mercy Corps through its LIWAY program conducted a detailed market study aimed at developing tailored new insurance product and/or policy input to address referencing, mainly character referencing, for the program target group. Accordingly, this is a call to interested companies to go further on the product development to address the referencing problems as per the indication on the research.
III. Objective
The main objective of this call is to invite financial institute/potential partner to develop an insurance product as an alternative mechanism for the existing personal/character referencing issues which LIWAY targets are facing. This should ultimately be a self-sustaining product that will fulfil your organisations’ profit or social mandate. LIWAY’s support is being offered in the short term to encourage innovation for the development of the product and share the risk in its initial piloting and development.
IV. The Support Available from LIWAY
Applicants are free to propose the exact support they require. The process will be competitive, and applicant selected will be those that are most likely to deliver a sustainable business model which can reach scale. One aspect of that will be at the degree to which the model needs financial support from LIWAY which reduces the chances of sustainability. A non-exhaustive list of the types of support available might include:
· Technical support from the research to feed in to product development
· Financial support to invest in product development
· Financial support to underwrite a proportion of the risk in the pilot period.
V. Scope of Work
To address referencing mainly character referencing, for the program target group, the applicant organization/company/financial institute will be responsible to:
· Develop tailored new insurance product to replace character referencing for the program target group.
· Develop a reinsurance strategy if needed and engage the reinsurers.
· Pilot the developed product in the market for the target group.
· Based on the performance of the piloting, willing to adjust and scale it up to reach more program target groups with little or no support from the program.
· Insure the approval of the product by the National Bank of Ethiopia.
VI. Deliverables
Generally, the applicant company/financial institute will be expected to produce and submit the following deliverables and the proposal should include different partners like Technology.
· Inception Report / Scoping Note (identify potential needs from end consumers)
· Design Product Prototype (ensure viability of the product).
· Business and Implementation Model –
· Dissemination Workshop/ Stakeholder Workshop –
· Pilot implementation – set up administrative process and procedure.
· Submit monthly and/or quarterly progress report.
· Data & technical quality assurance and analysis, including baseline a results.
· Present the technical and financial proposal for the development and delivery of the product.
· Submit monthly and/or quarterly progress report.
· Data & technical quality assurance and analysis, including baseline and results measurement of target groups.
I. Qualification/Eligibility Requirements
The Potential Partner/Financial institute:
· Should be legally registered to develop the product and underwrite the risk.
· Has a track record in engaging in similar engagement is a plus.
· Willingness to co-design the product for the need of LIWAY target group.
· An organization that are not prevented from receiving donor and specifically Sida funds.