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You can embed the username and password in the URL like this: sftp://TJones:Pass123@sftp.mysite.com
You could use a formula to build the url. Make sure the username and password are cleared out in the Connection tab of the Download tool. You should also turn off URL Encoding to prevent altering the password if it contains special characters.
Another option is to use the Action tool to update the UserName and Password values of the download tool.