NextGen_Financial_Services_Environment_Solicitation_-_Phase_I_-_Amendment_01.docx

U.S. Department of Education Office of Federal Student Aid Phase I – Solicitation Next Generation Financial Services Environment Introduction The U.S. Department of Education, Office of Federal Student Aid (FSA), is embarking on a new transformation known as the Next Generation Financial Services Environment (NextGen). Through this initiative, the Government seeks to implement a flexible, world-class financial solution to leverage in supporting its citizens. Initially, FSA seeks to modernize its technical and operational architecture, which will be flexible enough to expand and support other financial services. This effort will also include creating a new FSA-branded omni-channel engagement approach led by a mobile-first, mobile-complete, and mobile-continuous digital platform to support a finance lifecycle. In addition to improving the overall customer experience, the new environment will seek to improve operational flexibility, enhance cost and operational efficiency, and generate better outcomes for customers and taxpayers.

This is Phase I of a two-phase source selection in accordance with 20 U.S.C. 1018a(d) and ED Acquisition Regulation (EDAR) (48 C.F.R.) 3415.302-70(b). FSA anticipates utilizing a commercial solution(s) to meet the objectives of this initiative and requests responses from interested vendors for nine components. Vendors may provide a response for an individual, multiple, or all component(s) (as shown below), so long as responses are delineated by component. Vendors are not required to provide a response for each component to be considered. Vendors are not required to have student aid experience to participate. Components include:

Component A: Enterprise-wide digital platform and related middleware Component B: Enterprise-wide contact center platform, customer relationship management (CRM), and related middleware Component C: Solution 3.0 (core processing, related middleware, and rules engine) Component D: Solution 2.0 (core processing, related middleware, and rules engine) Component E: Solution 3.0 business process operations Component F: Solution 2.0 business process operations Component G: Enterprise-wide data management platform Component H: Enterprise-wide identity and access management (IAM) Component I: Cybersecurity and data protection Independent quality assurance support will be separately solicited on a similar time frame and will be responsible for assisting FSA in monitoring vendor operations and performance. Quality assurance support vendor will be independent from vendors providing other NextGen components.

Background on FSA FSA’s core mission is to ensure that all eligible customers benefit from Federal financial assistance – grants, loans, work-study programs, etc. – for education beyond high school. The programs FSA administers comprise the nation’s largest source of student financial aid. Every year, over 18 million students apply for Federal aid and FSA has over 42 million customers across the student lending lifecycle. FSA’s total lending portfolio is $1.3 trillion in outstanding loans including $1.1 trillion that is directly serviced. The lending portfolio is growing at 7% per annum, driven by nearly $100 billion in annual disbursements across more than 15 million annual loan originations.

In conjunction with institutions of higher learning and third-party vendors, FSA provides lending information and services across the full Federal student aid lifecycle, including:

Application and eligibility determination: Customers learn about their options, then apply for Federal student aid through the FAFSA;

Disbursement: For eligible customers, FSA originates most aid through higher educational institutions to FSA customers;

Loan processing and servicing: FSA assigns customer loans to be serviced by one of nine loan servicers across four loan technology platforms;

Recovery: For those customers who fail to pay their loans and enter recovery, FSA contracts with a debt management vendor and Private Collection Agencies (PCAs) to engage with those customers.

Within loan processing and servicing, servicer partners perform a complete set of Federal student loan servicing activities including: customer service; loan counseling; billing and payment application and processing; repayment plan adjustments and application of benefits such as deferments, forbearance, or loan forgiveness/discharge; outreach and default aversion; quality control; and financial and other data reporting. Individual customers may have several loans on different repayment plans and may have entered special programs (e.g., Public Service Loan Forgiveness (PSLF), Total and Permanent Disability (TPD), or Teacher Education Assistance for College and Higher Education (TEACH)).

Each of the nine servicers operates its own engagement layer with proprietary branding (e.g., websites, mobile tools, contact centers), utilizes one of four servicing platforms, and maintains certain additional technical systems. The servicing platforms are customized to service Federal student loans, which include >30 permutations of repayment plans and additional unique rules related to forbearance, deferment, discharge, loan forgiveness, and recovery. A servicer will typically retain a customer account until it is paid in full, the customer defaults, or the customer receives a loan discharge. These servicing platforms must comply with all Federal security, financial management, and audit rules, regulations, and laws.

Today’s fragmented vendor landscape has created many issues, including:

Inconsistent customer experience for FSA’s customers. Customers move through the student aid lifecycle working with multiple vendors and partners, each with different interfaces and standards;

Limited branding opportunities for FSA. Customers often do not understand the role the Federal government, and FSA in-particular, play in their student loan journey; and Operational complexity and inefficiency. Each servicer has built redundant technical and operational solutions to operate within the current portfolio-aligned operating model.

Additional information about FSA can be found in Exhibit 1 and 2, below, in the attachment “01 - As-Is”, the attachment “02 – Vision”, and the 2017 Annual Report located at: https://www2.ed.gov/about/reports/annual/2017report/fsa-report.pdf.

Exhibit 1: Today’s environment across the student aid lifecycle

Exhibit 2: Today’s environment for processing and servicing

NextGen Financial Services Environment Goals FSA holds one of the largest consumer loan portfolios in the world and believes it should deliver for its customers on par with world-class financial services providers. To do that, FSA has established goals for the NextGen environment including:

First, FSA intends to provide a world-class customer experience throughout the student financial aid lifecycle to ensure:

Easier, more seamless customer interactions with FSA through an enterprise-wide, FSA-branded omni-channel digital platform featuring a mobile-first, mobile-complete, and mobile-continuous solution (i.e., allowing for seamless channel switching) to enable customers to receive additional support through the channel most appropriate to their needs;

Customers receive an experience informed by a holistic understanding of their needs, refined through ongoing analysis of customer data and customer feedback and continuously improved through activities like iterative user testing;

Customers better understand the financial implications of their student debt and make more informed decisions regarding the various repayment options and protections available to Federal customers; and Customers receive a consistent experience under the FSA brand across all vendors supporting NextGen.

Second, FSA intends to improve its operational flexibility by creating an environment that can efficiently and effectively integrate new capabilities and features, continuously improve and innovate, and adjust to stay in compliance with changing Federal rules, regulations, and law.

Third, FSA intends to drive greater operational efficiency; reduce complexity; improve the stability, resiliency, enterprise risk management, and cybersecurity of its systems; and ensure effective and efficient use of taxpayer dollars.

Fourth, FSA will measure its success in part on how well NextGen improves customer outcomes and facilitates compliance with Federal consumer protection standards.

NextGen Financial Services Environment Vision To accomplish FSA’s goals identified in Section III, it intends to deploy a new technical and operational architecture that provides a world-class customer experience across the entire student aid lifecycle, including both enterprise-wide solutions and solutions specifically for processing and servicing. This new model will include:

Omni-channel, enterprise-wide customer engagement led by a mobile-first, mobile-complete, and mobile-continuous solution To enable a world-class customer experience, FSA intends to procure an enterprise-wide, FSA-branded omni-channel digital platform featuring a mobile-first, mobile-complete, and mobile-continuous solution (i.e., allowing for seamless channel switching). The digital platform will be FSA’s “digital front door” for all customer journeys. To realize this vision, the digital platform will consolidate the multiple websites, mobile applications, and contact centers that currently exist across the full customer lifecycle (from application to servicing and default). This will require the digital platform to be closely integrated with technical components to be implemented specifically for NextGen as well as a wide range of other FSA systems. This layer will provide customers with a personalized experience across multiple channels with robust self-service options and seamless escalation to additional support when needed.

Common, integrated data management FSA envisions a solution to ensure customer touchpoints feed into a common integrated data management platform which contains all information of each student throughout the lifecycle. This common, integrated data management system will allow FSA to:

Generate customer insights through advanced analytics that improve services and reduce risk;

Reduce error rates to lessen customer frustration and costly mistakes; and Lower operating expenses through efficiency gains.

Robust cybersecurity and data protection State-of-the-art cybersecurity protection must not only be integrated into all of the components of the NextGen environment, but enterprise-wide cybersecurity must be holistically assessed and tested on an ongoing basis to ensure customer and FSA data is consistently protected.

Integration across the enterprise and potential to further scale solutions FSA anticipates that solutions or standards implemented during this phase will need to be integrated with additional vendors or other providers from across the student aid lifecycle and may be further expanded across the enterprise in the future. Accordingly, all solutions should be implemented with both integration and future scalability in mind, ensuring third-parties can “plug in” to use common tools and feed into common interfaces.

Procure best-in-class components to reduce complexity and improve efficiency To service loans in a more flexible, efficient, and effective environment, FSA intends to procure best-in-class technical solutions from leading financial services providers. This model will allow business process operations providers to “plug in” these solutions while providing customers with a consistent, world-class customer experience.

See Exhibit 3 for a visual representation of the NextGen vision.

Exhibit 3: NextGen Vision highlighting this solicitation’s focus

Components of the Next Generation Financial Services Environment FSA has identified the components that it believes may be necessary to realize the goals and vision for NextGen. “VII. Component-Specific Objectives and Constraints” provides objectives and constraints specific to each component FSA intends to procure. These components are listed below and presented visually in Exhibit 4.

Vendors may provide a response for an individual, multiple, or all component(s) (as shown below), so long as responses are delineated by component (see “X. Vendor Response Instructions” for more details). Components include:

Component A: Enterprise-wide digital platform and related middleware Component B: Enterprise-wide contact center platform, CRM, and related middleware Component C: Solution 3.0 (core processing, related middleware, and rules engine) Component D: Solution 2.0 (core processing, related middleware, and rules engine) Component E: Solution 3.0 business process operations Component F: Solution 2.0 business process operations Component G: Enterprise-wide data management platform Component H: Enterprise-wide identity and access management (IAM) Component I: Enterprise-wide cybersecurity and data protection Independent quality assurance support will be separately solicited on a similar time frame and will be responsible for assisting FSA in monitoring vendor operations and performance. The quality assurance support vendor will be independent from vendors providing other NextGen components.

Exhibit 4: Components in the Next Gen Phase 1 solicitation

Implementation approach that minimizes risk and disruption for customers while deploying world-class solutions As described in “VII. Component-Specific Objectives and Constraints”, “Solution 2.0” (Component D) is anticipated to be FSA’s environment for all existing customers at the time of award and “Solution 3.0” (Component C) is anticipated to be tailored for new customers. As a result, Solution 3.0 (Component C) should be more flexible and able to take advantage of more modern technical architecture than Solution 2.0. FSA recognizes that it may take time to deploy Solution 3.0. FSA also recognizes that it may not be cost-effective to service some of FSA’s older loans on Solution 3.0.

Solution 2.0 (Component D) is anticipated to serve as the primary environment for FSA’s existing customers. Solution 2.0 (Component D) will need to onboard borrower accounts from existing servicers in a time frame that minimizes disruptions for customers while ensuring completion of migration is finished prior to the end of the current servicing contracts. Given that Solution 2.0 (Component D) will need to be capable of servicing all existing customers, FSA anticipates that this solution will be capable of incorporating specialty programs such as TPD, TEACH, and PSLF. Solution 2.0 will need to provide a higher quality solution than today’s existing environment and continue to add enhancement features during the migration that support the overall goals of the NextGen Vision.

It may be possible for a single environment to meet the objectives and constraints of both solutions. Once Solution 3.0 (Component C) is deployed, FSA will determine the best distribution of loans between Solution 2.0 (Component D) and Solution 3.0 (Component C).

Target Milestones FSA has identified target milestones in pursuit of the NextGen goals identified in “III. NextGen Financial Services Environment Goals”.

Milestone 1 – Achieve early customer wins: FSA anticipates deploying capabilities across NextGen that meaningfully improve the customer experience on an accelerated timeline after award (i.e., within 6-9 months of the award date). Potential opportunities that could fall within this milestone include, but are not limited to: launching an FSA-branded omni-channel digital presentation layer enterprise-wide (Component A); launching the FSA brand on Solution 2.0 (Component D); reducing processing times and error rates for existing customers (Component D and Component F); and/or consolidating multiple FSA phone numbers to a single, enterprise-wide IVR (Component B).

Milestone 2 –Migrate existing customer loans to an enhanced environment: For Solution 2.0 (Component D) and Solution 2.0 business process operations (Component F), begin enhancing Solution 2.0 (Component D) and migrating existing servicing accounts as soon as possible after award with migration complete before the end date of the current servicing contracts. Enhancements to Solution 2.0 can continue to be tested and implemented while customer migration is ongoing.

Milestone 3 – Launch Solution 3.0: Launch Solution 3.0 (Component C) by a target date of late 2019 or early 2020 and begin onboarding new FSA customers. At time of launch, Solution 3.0 (Component C) would need to be integrated with a fully operational digital platform (Component A), contact center and CRM platform (Component B), enterprise-wide identity and access management (Component H), Solution 3.0 business services providers (Component E), and other relevant components and systems. Enhancements for Solution 3.0 (Component C) and related components could continue to be built, tested, and implemented after this milestone.

Milestone 4 – Identify enterprise-wide standards: Quickly identify an enterprise-wide identity and access management standard (Component H), cybersecurity standard (Component I), and common data architecture (Component G) for other vendors to incorporate into solutions, within 2 months of award.

Overarching Constraints Components will be subject to overarching constraints including:

Integration: Solutions must include features to allow them to easily integrate with NextGen, other FSA systems, and other third-party solutions. All vendors will also be responsible for taking the steps necessary to connect their solution(s) with other components of NextGen and FSA’s existing systems where necessary to realize the goals outlined in Section III.

Adaptability and ongoing innovation: Solutions should be capable of efficiently and effectively adapting to changes in the FSA operating environment (including changing Federal rules, regulations, and laws) and continuously improving and innovating.

Broad accessibility for customers: Solutions must meet or exceed existing Federal rules, laws, and regulations applicable to the FSA operating environment related to solution accessibility.

Cybersecurity: Solutions must include robust cybersecurity protections and features to ensure customer data is protected (illustrative technical constraints for existing security standards are included in the attached “03-Technical Constraints Compendium”).

Technical constraints: Solutions must meet or exceed existing Federal rules, laws, and regulations applicable to the FSA operating environment (illustrated in the attached “03 – Technical Constraints Compendium” and “04–Attachments for Technical Constraints Compendium”) for security, program operations, payments, reporting, and websites.

Quality control: Solutions must include the appropriate quality and internal controls and management oversight to ensure that best-in-class service is being provided.

Contents included in “03-Technical Constraints Compendium”:

For an illustrative view of FSA’s current environment, vendors are encouraged to refer to the attached compendium of constraints (“03 – Technical Constraints Compendium”) and attachments referenced (“04–Attachments for Technical Constraints Compendium”). Most of these constraints are derived from existing laws, regulations, and Federal agency guidance (e.g., NIST security requirements, FedRAMP requirements). These constraints frequently change due to acts of Congress and updates to Federal regulatory and non-regulatory guidance. Constraints fall into four categories: security, payments, reporting, and websites. While NextGen vendors will be responsible for ensuring their solutions comply with existing laws, regulations, rules, and Federal agency guidance, FSA welcomes suggestions for how FSA and its vendors could better operate within the current regulatory environment.

Component-Specific Objectives and Constraints This section includes component-specific objectives and constraints for the components of NextGen.

Component A: Enterprise-wide digital platform (mobile, web, and related middleware) Objectives:

The enterprise-wide digital platform provider will deliver an enterprise-wide digital solution that will serve as FSA’s digital “front door.” The platform will be world-class in design and ease of use to enable FSA’s customers to elect the digital platform as their primary channel for common customer journeys. The platform will provide a true omni-channel digital experience, including the ability to use a mobile device for all their needs (i.e. a mobile-first, mobile-complete, and mobile-continuous experience). The content and capabilities presented to customers must be grounded in FSA customer needs and guide customers in making more informed decisions. Unlike the current environment where customers navigate multiple websites and mobile applications maintained by FSA and its vendors at different points of customer journeys, customers will primarily interact with FSA through this enterprise-wide digital platform that allows for a consistent customer experience, robust self-service options, and seamless customer connection to other FSA resources (e.g., contact centers) when needed.

Operating and solution constraints:

Solution must include a mobile-first, mobile-complete, mobile-continuous, omnichannel digital platform with features comparable to those deployed by leading financial services providers and other customer-centric organizations.

Solution must ensure FSA’s current and potential future customers can easily access and understand its products and services through public content and access private content unique to each user. The digital platform will be FSA’s primary digital presence with a scope of responsibilities that includes the content and services currently provided by sites including: StudentAid.ed.gov, StudentLoans.gov, MyEdDebt.gov, NSLDS.gov, FAFSA.gov, and third-party loan servicer websites.[footnoteRef:2] [2: Links to existing servicer websites can be found at https://studentaid.ed.gov/sa/repay-loans ]

To the maximum extent possible, solution must allow customers to be able to complete all customer journeys through the digital platform (e.g., submit FAFSA, check loan balance, make a payment, enroll in a payment plan). Where FSA has a viable solution already available or in development (e.g., myMoney mobile application), the digital platform will need to be able to integrate some or all of the solution(s) and/or provide a portal to that solution(s).

Solution must include a content management system that can be easily updated and allow FSA to make direct changes to content quickly without significant reprogramming.

Solution must encourage customers to utilize self-service solutions by making digital self-service efficient and effective across all journeys.

Solution must allow customers to seamlessly switch channels if they need additional support.

Solution must integrate with other components as needed regardless of the provider and have the ability to update and change quickly with minimal cost.

Component B: Enterprise-wide contact center, CRM, and related middleware Objective:

FSA intends to provide customer support capabilities on par with world-class customer service organizations. When the digital platform (Component A) is insufficient to meet customer needs, customers will be able to contact FSA through their preferred channel (e.g., chat, social media, telephony, email). Once a customer initiates contact, that individual will receive a world-class experience that includes being quickly routed to the best available resource for their inquiry (e.g., live or AI agent) and receiving accurate and consistent information to address their need. Data gathered through direct customer engagement should be leveraged to personalize the customer experience across channels and identify opportunities to improve the self-service digital experience.

To implement a seamless customer experience, Component B will include the following sub-components:

CRM: The CRM solution will allow all customer-facing staff and vendors across the FSA environment to access a single, unified view of the customer. The CRM solution will also interface with the enterprise-wide digital platform (Component A) to ensure that customers experience a digital environment that tailors content to their needs.

Contact center technical backbone: The contact center technical backbone will support multiple channels for customer communication while ensuring there is only one solution per channel (e.g. a single FSA chat platform, a single FSA phone number). The solution will effectively and efficiently utilize multiple solutions to address customer concerns (e.g. containing calls within the IVR). Where customer inquiries cannot be addressed through automated solutions or self-service, the technical backbone will route customers to the appropriate resource for live support.

Quality control and knowledge management: The solution will include development of standard work products for contact center resources in the servicing environment (e.g., contact scripts, training materials) to ensure customers receive consistent and accurate support for servicing inquiries. The solution will include conducting regular quality control monitoring of customer engagement conducted by Solution 2.0 business process operations (Component F) and Solution 3.0 business process operations (Component E) resources to ensure consistent high-quality customer service across all channels. This capability will allow FSA the option to partner with multiple vendors to provide call center capabilities while ensuring consistency across those vendors.

Additional operating and solution constraints:

CRM:

Deploy a proven customer relationship management (CRM) solution for Solution 3.0 (Component C) and Solution 2.0 (Component D) that has the capability to interface with multiple data sources and channels across the FSA enterprise.

Allow authorized staff and partners to access and extract certain data and reports, including a function that allows authorized higher education officials to access relevant student data as permissible under existing laws and regulations.

CRM will also serve as the agent desktop solution for the servicing-related contact centers provided by the Solution 3.0 business process operations (Component E) and Solution 2.0 business process operations (Component F).

Contact center technical backbone:

Transfer customers with inquiries that do not pertain to servicing to the appropriate contact centers (e.g. Student Loan Support Center, FSAIC, FSA ID Call Center, Loan Consolidation Call Center, Default Resolution Group, Ombudsman, and Enterprise Complaint System) while demonstrating the ability to ultimately address all these customer inquiries within the solution.

Transfer servicing-related contacts to either a Solution 3.0 business process operations vendor (Component E) or a Solution 2.0 business process operations vendor (Component F) depending on where the customer’s loan sits.

Evaluate drivers of customer demand and deploy capabilities that reduce the need for live agent support.

If multiple tools are necessary to support all channels, ensure that those tools are integrated to maintain a single customer view across all channels.

Solution must integrate with other components as needed regardless of the provider and have the ability to update and change quickly at minimal cost.

Component C: Solution 3.0 (core processing, related middleware, and rules engine) Objective:

Solution 3.0 should serve as the environment for FSA’s new customers and will provide the technical systems necessary to service loans for customers with the loans and repayment plans that FSA offers today. It will also be highly adaptable to support future products and services FSA may provide. This solution will identify cost efficiencies through increased automation and greater flexibility (e.g., through innovative middleware and/or microservices solutions), relying on streamlined manual processing operations (Component E) if automation is not feasible. Solution 3.0 will have significantly greater flexibility than Solution 2.0 (Component D) to support changing servicing rules, laws, and regulations and the ability to quickly implement new functionality with minimal operational complexity. Relative to the current FSA environment, Solution 3.0 will ensure more consistent application of servicing rules, prove more adaptable to a shifting regulatory environment, and provide a more flexible, technology-enabled system that reduces error rates and processing expense.

Operating and solution constraints:

Perform all loan servicing functions for the currently available loans and repayment plans in the Federal student loan environment, including:

Loan servicing functions that include, among others, calculating payments due, payment application, balance calculations including capitalized interest, and loan status tracking;

Support for retroactive processing, including the retroactive application of deferments, forbearances, payments, and other transactions;

Processing traditional repayment plans including Standard, Graduated, and Extended, as well as combinations thereof;

Processing income-driven repayment plans including Income-Contingent, Income-Based, Pay-As-You-Earn, and Revised-Pay-As-You-Earn;

Supporting income-driven plans’ specific eligibility requirements; allowing for variable payments that are tied to a customer’s income, family situation, and other characteristics which may fluctuate; and require annual recertification and recalculation;

Supporting switching across repayment plans; and Scaling to anticipated volumes of loans serviced.

Provide loan servicing functions for various customer classes and loan statuses, as well as special programs, within the Federal student loan environment of today, including, but not limited to: Loans to customers in school and in the grace period; TEACH grants; military customers; PSLF and other loan forgiveness programs; TPD and other loan discharge programs; loans in forbearance, deferment, and various stages of delinquency; and loan consolidation.

Provide the ability to maintain a robust data history, including retroactive processing (e.g., “as-was” vs “as-is”), and tracing loans through consolidation transactions.

Provide the ability to easily scale as volumes increase and quickly implement new processing functionalities with minimal major technical interventions.

Allow third-party providers to engage with (“plug into”) the system to complete processes necessary to effectively serve customers as outlined under component specific-objectives and constraints for Solution 3.0 business process services (Component E).

Solution must integrate with other components as needed regardless of the provider and have the ability to update and change quickly at minimal cost.

Component D: Solution 2.0 (core processing, related middleware, and rules engine) Objective:

Solution 2.0 should serve as the environment for FSA’s existing customers, with capabilities enhanced beyond those present in today’s loan servicing environment. Solution 2.0 will initially provide the full suite of technical capabilities associated with servicing loans in the FSA environment, from front-end customer engagement down to the technical solution supporting the processing and servicing of loans, with enhancements provided where possible to improve customer experience and operational flexibility. Solution 2.0 will migrate loans from existing platforms on an accelerated time frame following the contract award and provide all technical solutions necessary to service a loan. Where resources are needed for operational functions, Solution 2.0 will provide mechanisms for the Solution 2.0 business process operations solution (Component F) to operate within the Solution 2.0 system boundaries. Solution 2.0 will deploy advanced capabilities to provide customers with a world-class experience, improve automation and system flexibility, and reduce operational complexity and inefficiency for FSA. Solution 2.0 will ultimately phase out certain customer engagement capabilities when it integrates with the proposed, enterprise-wide digital platform (Component A), enterprise-wide contact center platform (Component B), and enterprise-wide identity and access management solution (Component H).

Operating and solution constraints:

Solution 2.0 (Component D) must address the constraints identified for Solution 3.0 (Component C). In addition, Solution 2.0 (Component D) must address the following constraints:

Provide world-class service, enhanced beyond today’s environment, while continuing to meet the requirements currently placed upon Title IV Additional Servicers for all loans and repayment plans currently in FSA’s portfolio;

Onboard student loans from existing servicers quickly after award on a schedule that maximizes FSA operational and cost efficiency while minimizing borrower disruption (see “01 - As-is” attachment for further details on loan breakdown across existing providers and across loan types);

Demonstrate the capability to effectively and efficiently transfer loans to Solution 3.0 (Component C); and Provide transitional engagement layer solutions for existing customers while the enterprise-wide digital platform (Component A), contact center platform (Components B), and enterprise-wide identity and access management solution (Component H) are implemented. Solution will successfully integrate with these components once they are operational and phase out redundant capabilities.

Component E: Solution 3.0 business process operations Objective:

The Solution 3.0 business process operations solution(s) will support the efficient and effective operation of the NextGen environment under FSA’s brand by providing the business process resources necessary to initiate engagement with FSA’s customers, respond to inbound customer contacts, and perform servicing functions that cannot be automated. Solution(s) will drive world-class customer experience by identifying strategies to improve self-service functionality and efficiently and effectively process back-office needs for FSA customers. These resources will provide an enhanced level of service than today’s environment and one that is consistent with leading financial services providers and other industry-leaders recognized for their customer service.

Component E includes the following sub-objectives:

Customer engagement and outreach: The solution will develop and execute outbound engagement campaigns to achieve FSA’s goals, based on a deep understanding of customer needs.

Contact center support: The solution will be equipped to provide world-class customer experience in responding and resolving inbound customer inquiries across multiple channels.

Loan processing: The solution will efficiently complete back-office activities related to loan servicing that cannot be automated while interfacing with other relevant components. Solution will seek to identify additional processes that can be streamlined or automated to achieve additional cost efficiencies and minimize errors.

Operating and solution constraints:

Customer engagement and outreach For customers whose loans sit on Solution 3.0 (Component C), this vendor(s) will print and mail all servicing-related materials.

For all customers, this vendor(s) will process inbound servicing-related physical mail and route it to the appropriate destination for both Solution 3.0 (Component C) and Solution 2.0 (Component D).

Contact center support Perform contact center operations for customers with loans on Solution 3.0 (Component C) while operating within the system boundaries of the agent desktop/CRM solution provided by the enterprise-wide contact center (Component B).

Loan processing Provide processing capabilities as required by Solution 3.0 (Component C) including the review, validation, and processing associated with enrollment, applications, and requests for various borrower programs and loan status adjustment, such as:

Income-driven repayment plan processing, including application and eligibility review, income checks and payment calculations, and annual recertification activities;

Processing associated with military service members, including requests for deferment and forbearance, SCRA benefits, and hostile pay benefits;

School and customer enrollment processing, including manual entry of hard-copy applications;

Deferment and forbearance application processing;

Loan consolidation request processing;

Special programs processing, including applications and transfers associated with TPD and loan forgiveness programs; and Processing related to specialty claims, including death, closed school, and borrower defense requests.

Conduct error and dispute resolution investigation and processing, including:

Direct and indirect credit bureau disputes filed by customers or initiated by the credit bureaus;

Account maintenance, including manual correction of errors identified through data integrity scans and in response to FSA change requests; and Payment processing, including researching lost or misapplied payments and payment reapplication at the request of customers or FSA.

Operate within the system boundaries of the technical solutions provided by Solution 3.0 (Component C) and enterprise-wide contact center solution (Component B).

Component F: Solution 2.0 business process operations Objective:

The Solution 2.0 business process operations provider(s) will support the efficient and effective operation of the NextGen environment under FSA’s brand by providing the business process resources necessary to initiate engagement with FSA’s customers, respond to inbound customer contacts, and perform servicing functions that cannot be automated. Provider(s) will drive world-class customer experience by identifying strategies to improve self-service functionality and efficiently and effectively process back-office needs for FSA customers. These resources will provide an enhanced level of service than today’s environment and one that is consistent with world-class financial services providers and other industry-leaders recognized for their customer service. This component will enable a seamless transition from utilizing transitional engagement layer technologies for Solution 2.0 (Component D) to the enterprise-wide engagement layer (Component A & B) once implemented for FSA’s existing customers.

Component F includes the following sub-objectives:

Customer engagement and outreach: The solution will develop and execute proactive outbound engagement campaigns to achieve FSA’s goals, based on a deep understanding of customer needs, for Solution 2.0 (Component D) loan customers.

Contact center support: The solution will be equipped to provide world-class customer experience in responding and resolving inbound customer inquiries across multiple channels for Solution 2.0 (Component D) loan customers, utilizing Solution 2.0’s transitional engagement layer (Component D) and the enterprise-wide engagement layer once implemented (Component A & B).

Loan processing: The solution will efficiently complete back-office activities related to Solution 2.0 (Component D) loan customers that cannot be automated. Solution will seek to identify additional processes that can be streamlined or automated to achieve additional cost efficiencies and minimize errors.

Operating and solution constraints:

The Solution 2.0 business process operations solution(s) (Component F) must meet all constraints associated with “Loan processing” for Solution 3.0 business process operations (Component E) (but not those constraints related to “Customer engagement” or “Contact center support” for Component E) with the following additions:

While the enterprise-wide digital engagement layer is being implemented (Component A and Component B), perform all contact center activities and back-end processing functions that cannot be automated within Solution 2.0 (Component D) system boundaries;

Once the enterprise-wide digital engagement layer (Component A & Component B) is implemented, perform all contact center activities for customers whose loans sit on Solution 2.0 (Component D) within the operating system boundaries of the agent desktop/CRM solution provided by the enterprise-wide contact center solution (Component B); and For customers whose loans sit on Solution 2.0 (Component D), print and mail all servicing-related materials. Solution will need to process inbound servicing-related physical mail while Solution 3.0 business process operations (Component E) is implemented.

Component G: Enterprise-wide data management platform Objective:

The enterprise-wide data management platform will support accurate record-keeping and data analytics across the FSA enterprise. It will seamlessly integrate data sources and create a common data architecture to eliminate the fragmentation and inconsistency of data in today’s environment.

Operating and solution constraints:

Determine a master data management and governance (MDM) architecture that allows for a master record of a customer’s loan history, interfacing with relevant FSA systems including, Solution 2.0 (Component D) and Solution 3.0 (Component C), and other relevant data sources to support accurate record-keeping, system operations, and enhanced data analytics. The MDM architecture should have the potential to serve as the standard data architecture solution and to be scaled across the entire FSA enterprise.

Provide a single view of all customers across the enterprise that enables analytics and reports to be run on customer data.

Provide advanced analytical tools and capabilities (e.g. data preparation, visualization) necessary to derive meaningful, real-time insights into customer behavior. Make these tools and capabilities available for use by FSA and authorized FSA contractors.

Support FSA by providing data analytics support including, but not limited to, dedicated support from specialists (e.g., data scientists, data engineers) who can generate data insights that informs FSA’s strategic objectives and specific decisions regarding customer engagement.

Component H: Enterprise-wide identity and access management Objective:

Deploy a world-class identity and access management solution that easily integrates with other solutions and serves all FSA users (customers, staff, contractors, guaranty agencies and lenders, postsecondary education officials, and other authorized third parties).

Operating and solution constraints:

Allow for single sign on across all FSA systems, including customer verification within the environment that is user-friendly while supporting critical security capabilities. Systems in-scope include, but are not limited to: all NextGen components included in this solicitation and FSAID, COD, NSLDS, FMS, and PEPS.

Meet NIST Special Publication 800-63-3, Digital Identity Guidelines for information on the level of assurance at Identity Assurance Level (IAL) 3, Authenticator Assurance Level (AAL) 3, and Federation Assurance Level (FAL) 3.

Solution will need to be able to migrate all users to an authentication solution with minimal disruption Enterprise-wide identity and access management provider must be able to meet existing (or similar) FSA operating environment constraints referenced in “VI. Overarching Constraints”, including those related to security, payment, reporting, and other applicable constraints.

Component I: Enterprise-wide cybersecurity and data protection solutions Objective:

Cybersecurity and data protection solutions will provide FSA the ability to protect its data and systems and monitor, manage, and remediate cyberattacks and information security risks across the enterprise.

Operating and solution constraints:

As specified in “VI. Overarching Constraints,” solutions must include robust cybersecurity protections and features to ensure customer data is protected that meet existing Federal rules, laws, and regulations applicable to the FSA operating environment (illustrative technical constraints for existing security standards are included in the attached 03-Technical Constraints Compendium).

Expected Volumes FSA expects that when NextGen is implemented, many of the customer engagement figures will significantly change (e.g., digital platform with greater self-service functionality will create less need for inbound calls and outbound postal mailings). Expected volumes relevant to the NextGen environment include:

Size of business >37 million customers being serviced in the FSA environment (with an additional 5 million serviced through the FFEL program outside of the FSA environment) Lending portfolio that exceeds $1 trillion in outstanding principal Over 18 million loans were assigned to servicers last year with a significant proportion (58%) assigned between August and October Customer base projected to grow over 40% between 2017-26 Customer engagement for servicing The current servicing environment supports a high volume of inbound and outbound customer engagement.

Inbound communications Over 15 million online accounts accessed each month Over 2 million inbound calls per month with an average handle time of ~7 minutes ~500,000 incoming mails per month Over 180,000 incoming emails per month ~45,000 customer complaints per month Outbound communications Over 35 million outbound emails per month Over 30 million outbound calls initiated per month Over 7 million pieces of outbound mail per month Loan payments processed Over 200 million payment transactions are processed per year Loan processing Over 450,000 customers submit annual re-certifications for an income-driven repayment plan each month Over 300,000 loans are closed or discharged each month due to death, disability, are paid in full, or for other reasons (not including consolidation) Over 250,000 customers change their repayment plan each month, impacting the status of ~1.3 million loans On average, over 350,000 loans are transferred from servicing to FSA’s Debt Management and Collection System (DMCS) each month ~75,000 customers submit certification for TEACH grants each month ~70,000 customers consolidate their loans each month impacting an average of five loans per borrower ~35,000 customers submit certification for PSLF each month Over 10,000 customers submit certifications for TPD each month

Selection factors This is Phase I of a two-phase source selection in accordance with 20 U.S.C. 1018a(d) and ED Acquisition Regulation (EDAR) (48 C.F.R.) 3415.302-70(b). The Government will review each response component by component. The following are the factors on which vendors submitting responses will be selected for consideration for Phase II of this selection process:

Selection Factor 1 Strategic Fit – Responses will be reviewed to assess the degree to which the solution included in the vendor’s response enhances FSA achievement of its goals while likewise minimizing risk and meeting scheduled milestones. These goals include, but are not limited to:

Delivery of a world-class customer experience Achievement of greater operational flexibility Reduction in complexity Improvement in customer outcomes of FSA programs Selection Factor 2 Past Performance – Responses will be reviewed to assess how the vendor’s past performance experience indicates success in deploying world-class solution(s) of similar complexity and scope for the component(s) vendor is submitting a response for. Past performance examples should include a broad range of relevant experience and are not limited to experience with student aid. Responses will also be reviewed to determine the quality of past performance in respect to timeliness, quality, and cost management.

Selection Factor 3 Cost/Price – Responses will be reviewed to assess whether cost submitted:

Is a cost likely to be associated with the solution offered;

Delivers to the Government price(s) consistent with those offered to the offeror’s best, most favored customers; and Demonstrates innovation in managing and reducing cost over the span of the contract and passing all or a portion of savings to your customer(s).

Selection Factor 4 Understanding of the student aid financial services environment - For vendors submitting responses for Components C, D, E, and F, responses will be assessed to determine if the offeror’s response demonstrates an understanding of the current student aid financial services environment. Vendors do not need previous experience with Federal student aid to demonstrate this understanding.

Selection for Participating in Phase II Responses will be reviewed under Selection Factors 1, 2, 3, and 4 (for applicable components). Selection Factor 1 is significantly more important than Selection Factors 2, 3, and 4.

In accordance with EDAR 3415.302-70(b)(3), the Contracting Officer will select the vendors that are eligible to participate in Phase II of this procurement. This selection will be based on the Contracting Officer’s determination of which vendor(s) submit the most advantageous component solution(s) to the Government.

The Contracting Officer will limit the number of selected vendors to the number of sources that the Contracting Officer determines is appropriate and in the best interests of the Government. Only sources selected in Phase I will be eligible to participate in Phase II.

Vendor Response Instructions Vendors may provide a response for an individual, multiple, or all component(s). In accordance with EDAR 3415.302-70(b)(2), each vendor shall submit a written response, to include the following:

Executive Summary A high-level overview of the vendor, vendor contact information, identification of which component(s) vendor is providing a response for, and information about the vendor that it feels is important to showcasing their capabilities.

Solution For each component(s) to which the vendor wishes to respond, (as well as for a combined solution if the response includes multiple components), vendor shall submit a narrative describing how the NextGen Financial Services…