The advancement of technology has improved the convenience of many processes in modern society. One such improvement has come in the form of payment processing solutions tailored for the public sector.
This sector includes government agencies and all the services they provide citizens including water, electricity, transportation, healthcare and more.
People have gotten used to payment processing services established by private companies like Amazon and, as citizens, they expect the same convenience and experience when paying for utilities as when buying a jacket online.
These days, resorting to physical means of payment such as cash or checks seems inconvenient and outdated.
For example, when it comes time to pay for car registration, isn?t it great to be able to do that online rather than spend a day off at the DMV, wait in a long line, just to pay and go home? We can thank modern payment processes for helping us avoid that and have more time to do what we want.
So let?s outline some more of the great advantages of modern payment processing that benefit both public sector organizations and citizens alike.
- Government Benefits Distribution
A great advantage for citizens and governments of the adoption of digital payment processing in the Public sector has been the ability to distribute benefits to individuals and families in need of financial assistance services.
This is done via the digital distribution of funds into a mobile wallet account with an associated debit card that is given to members of these programs. With these accounts, accountholders can access local ATM networks to withdraw their balance and also pay at POS systems.
As an example, here at Emida Technologies we are able to provide government organizations with the below requirements that are commonly involved in such programs:
- Sourcing and provision of cards, as well as the mobile and/or digital payment solution.
- Creation of the accounts.
- Assigning PINs to the cards.
- Placing funds into the accounts.
- Provide reports on transaction volumes, card balances, and listings of inactive cards.
- Provide customer service to the representatives of the Government organization partner.
- Enhanced Citizen Experience
Given that citizens are so used to the latest payment processes offered by private retail companies, having the same processes available for public sector organizations improves their experience. Some of the things citizens expect, and also get with these processes are:
- Multiple Payment Method Options: They can choose to pay with credit cards, debit cards, digital wallets, and more. This is helpful both to citizens with access to bank services as well as underbanked individuals who may instead use prepaid cards to pay bills.
- Instant Payment Confirmations: Before modern-day payment processing solutions, citizens had to make payments with cash or checks. When checks were used, it would be a few days before confirmation was received that the check had cleared or bounced. This is a hassle we no longer have to deal with. We can know right away if the transaction was a success or not.
- Online Payments and Mobile Platforms: Thanks to the internet, governments and citizens can both enjoy the convenience of making and receiving payments online rather than at physical locations. Meanwhile, citizens no longer have to spend hours driving to and standing in line to be assisted. They can make the payment from the convenience of their own smartphone or laptop.
2. Improved Operational Efficiency
Modern payment processing solutions dramatically streamline transaction processes and ensure that not only are most of these automated, but they also reduce the need for manual intervention. This has many effects that benefit government agencies.
- Faster Transaction Processing: Transactions are processed immediately or close to immediately.
- Reduced Errors: It minimizes the risk of human error.
- Streamlined Reconciliation: Modern systems can track and match transactions with accounts much more efficiently, so it is easier to verify payment history.
3. Enhanced Security
Understandably, one of the biggest concerns with digital payment processing is making sure the transaction and personal data is safe, as well as making sure the transaction is secure and the payment is received without issues. Digital systems come equipped to ensure top-level security.
- End-to-end Encryption: Modern systems allow for encryption to ensure user data stays safe and confidential.
- Fraud Detection: Anti-fraud algorithms analyze and flag potentially fraudulent transactions instantly.
- Compliance with Standards: Digital payment processing systems allow for compliance with security standards such as PCI DSS.
4. Cost Savings
While there is an upfront cost for setting up digital payment systems, in the long term these actually help to save money on many of the costs associated with traditional processes.
- Decreased Use of Paper: digital receipts save government agencies money and lower the impact they have on the environment.
- Decreased Costs on Labor: with automated processes, there is less need for workforce deployment so their operations can be run with fewer people.
- Decreased Physical Infrastructure: since payments can be done online, this lowers the amount of space needed for physical locations and lowers overhead.
5. Increased Tracking, Management and Transparency of Financials
Imagine how difficult it must have been to have numbers that did not add up and have to search through thousands of transaction records by hand. This is the type of issue that is most dramatically improved with digital solutions thanks to tracking and reporting tools.
- Real-time Reporting: allows for visibility of the most up-to-date data to make quick financial decisions at the push of a button.
- Transparency with Transaction History: should there be any need to find data for a particular transaction, account, date, or time, digital systems can call up this information quickly. This helps ensure accountability and transparency.
- Spotting Trends and Making Accurate Predictions: Reporting tools on digital systems often allow for visual graphs of data over time. With enough of this data and the ability to easily compare seasonal changes or trends, government organizations can make more accurate predictions for the future and be proactive with their financial planning.
A 2009 report by Lexmark on Government printing (page 5) found that the average federal employee printed 7,200 pages per employee per year. Imagine how much paper was wasted which today has been replaced with digital versions of documents, both in terms of documents for citizens as well as internal documents. A benefit like this greatly reduces the environmental footprint in addition to saving a lot of money on paper.
Innovations in payment processes foster inclusivity in different forms for diverse individuals. They can provide convenience to people with visual impairments for example, who can use voice-activated payment options to run their transactions.
Not only that but with various payment methods in addition to debit and credit cards such as prepaid cards and digital wallets, underbanked individuals can take part in the financial system which allows for financial inclusion in underserved communities.
8. Addition of New Services
If government organizations wanted to create tiered pricing systems or special promotions, they could easily do this with a digital system. This flexibility allows for the addition of new services, service structures, or promotions. An ability to pivot surely proves a great advantage for both government organizations and citizens.
With the quick pace of technological innovation, it is understandable that governments may struggle to make quick adjustments. After all, they manage services for incredibly large amounts of people.
However, great leaps forward have been made with the adoption of digital payment processes that allow them to streamline their operations and respond quickly to the needs to citizens. These systems we use every day without even thinking about providing a strong foundation for further innovation and quick adoption.
About Emida Technologies
We are fintech offering digital access to millions of underbanked consumers via our 36-country retailer network. We enable financial inclusion for 3MM monthly users through 50K+ points-of-sale offering a cash on-ramp solution.
Additionally, we help governments?.
For 20+ years we have offered cost-effective & customizable SaaS platforms to telcos, master distributors & MSMEs; distribution channel management; sales team optimization; IT cloud-based services; & mobile top up networks with 24/7/365 support.