The Home Office is seeking a service provider to work with the UK Border Agency to provide a number of payment services to support asylum seekers and foreign prisoners looking to return to their home country.
An online tender reveals that the Border Agency is looking for "innovative ways" of providing the service based on technology already in use, where the use of traditional bank accounts is not suitable.
The contract is worth an estimated £3m.
Under the Immigration and Asylum Act 1999, the Border Agency is obliged to support anyone that is applying for asylum in the UK, those that have been refused asylum but are unable to leave the UK immediately, and foreign prisoners in the UK who are looking to return and settle in their home country.
The tender reads: "The provision of financial support will comprise of medium volume, low value, regular and one-off payments to individuals located through the UK, as well as the provision of a pre-paid card to those leaving the UK...for use in their designated country.
"Key service requirements will include: the intended individual receiving the exact authorised amount in a timely manner, individuals not being stigmatised in any way; the system being secure and appropriate and timely management being provided to the Authority".
The chosen supplier will have to provide solutions that include cash payment services, pre-payment cards for use in retail outlets in the UK and pre-paid card services for individuals to obtain cash abroad.
The current system provides payments to about 400 designated outlets nationally, largely through the Post Office, and prepaid cards can be used at 8,800 retail outlets.
The scheduled date for the Home Office to start the procedure of awarding the contract is mid-June.