Improving the Use of Remittance-Based Digital Financial Services by Migrants from Nepal

The United Nations Capital Development Fund’s (UNCDF) Migrant Money pillar is part of their Inclusive Digital Economies area with the goal of promoting digital finance that leaves no one behind. UNCDF collaborated with a team of SIPA students to identify considerations for a digital financial literacy program that can increase the uptake of financial services for migrants and their families in the context of Nepal. Between December 2022 and May 2023, the team conducted desk and field research to develop key considerations and recommendations for UNCDF to build a sustainable business case for providing financial services for migrants and implement digital conversion strategies for vulnerable groups in Nepal. 

    

After gathering data through interviews and focus groups, the team mapped the migration ecosystem and migrant journey in Nepal. The team provided an appealing business case to UNCDF's partner in Nepal, IME Pay, by introducing the staircase to financial security, which illustrates the different stages of financial security: (1) earn, (2) transact, (3) save, and (4) invest.  Given the large aggregate market size of “transactors” including migrant workers and their families, the team was able to show IME Pay why educating and enrolling this population made economic sense.

In sum, the type of financial literacy content and the channels through which the content will be delivered varies by customer segment. However, the analysis shows that all customer segments prefer saving in the short-term and need access to money now rather than later. By focusing on a broader market and including relevant stakeholders in strategies, the team believes UNCDF and IME Pay can improve the migration ecosystem as a whole and ultimately, strengthen the financial resilience of Nepalese migrant workers and their families.