In the Rush to Digital, Governments Can’t Leave Behind Cash Payers

iStock.com/Edalin

 

Connecting state and local government leaders

COMMENTARY | As local and state governments embrace digital payment services, they must ensure that these services are equitable and accessible to all—including people who are unbanked or underbanked.

Even before the Covid-19 pandemic, many state and local governments were undertaking significant changes to both their revenue and customer service operations with new technology. By offering more payment options like web, mobile, cashiering and kiosks, more residents were able to pay for tickets, taxes, utilities and other fees much more efficiently. Despite this, many citizens continued to use in-person payment options—that is, until those services were halted due to the pandemic. 

While the shift to digital payments has accelerated in the last year, the momentum toward new technology and online services shouldn’t forget that in-person cash services still matter, perhaps more than ever. Here’s how governments can ensure that new technology innovation doesn’t leave behind cash payers. 

Many People Pay In-Person, Often in Cash

 According to data from the CityBase platform, even when payers have both online and in-person options, 20%–30% of transactions are still conducted in person. Of those in-person transactions, 30% of individuals and households pay exclusively in cash.

Customers paying in cash are more likely to have low incomes and be unbanked, meaning they have no checking or savings account. Others are underbanked, meaning they have at least one checking account but also use services outside of the traditional banking system, like payday loans or check cashers. In 2017, the FDIC found that 6.5% of U.S. households (8.4 million) were unbanked and an additional 18.7% (24.2 million) were underbanked. These are the same people who have been and will continue to be hardest hit by the pandemic. 

We see over and over that these customers take great pains to be compliant in paying their bills. Not only to avoid service shut offs or additional penalties, but also because of pride and dignity. If local governments do not provide safe, convenient, official ways to pay in person, they are likely to see two outcomes: lower and slower revenue collection, at a time when government budgets are stressed, and a poor experience for customers.

When official options don’t exist, customers are more likely to pay their bills using check cashing stores. This subjects them to higher, sometimes predatory, fees. Their payments aren’t posted immediately to their account, which extends the time that they might incur penalties. Service providers lose a valuable opportunity to interact with the customer and have minimal data associated with these transactions. It is critical that local governments ease this burden for some of their most vulnerable residents.

24/7 Kiosks Continue to Safely Serve Customers during The Pandemic 

Governments and utilities that provide self-service, in-person payments via 24/7 kiosks were prepared to continue safely serving walk-in customers during the pandemic—without compromising customer experience or burdening the most vulnerable households with extra fees.

One investor-owned utility that has a network of 80 payment kiosks saw that when their payment centers closed due to Covid last March, many of their customers still chose to pay in person. Last April, the utility experienced a 19% increase in kiosk transactions, with 19,700 people paying by kiosk for the first time, indicating that some customers who previously paid via cashier were opting now to pay via kiosk rather than online. Since then, the utility has maintained and increased their pre-Covid volume of kiosk transactions, which now top 85,000 payments per month. 

Now, cities that previously lacked self-service channels for their walk-in customers are quickly pivoting to them. We've seen several towns and cities introduce self-service kiosks by using federal pandemic relief funds, since the kiosks help maintain continuous government operations and access to services and reduce the spread of Covid-19 by eliminating person-to-person contact.

For example, the city of Lawrence, Indiana, installed indoor and outdoor payment kiosks at their government center in early fall 2020. The city’s utilities serve more than 14,000 water customers. Before Covid-19 stay-at-home measures, on average 2,000 Lawrence residents paid water bills in person via cashier each month, including 500 cash transactions. Residents can now pay city utility bills 24/7 using cash, check or card, without incurring any service fees.  

Modern Technology Equally Important In-Person As It Is online  

Just like many local governments are upping their focus and investment in online services, it’s critical to also modernize in-person service. As it relates to payment technology, this means cloud-based, integrated and ideally centralized systems for both cashier-assisted and self-service payment channels.

Real-time integrations improve both the customer and staff experience. Customers gain trust in the payment process because they can immediately see their recent payment reflected against their account. The payment interface can notify the customer of their minimum payment due to avoid penalty fees, provide assurance that they have avoided a cutoff date, or even allow them to opt into a payment plan.

City staff also benefit from having updated information on a customer’s account payment status. Transaction information is readily available if the customer seeks support or wishes to refund the payment. The city receives funds faster and can automate many of the time-consuming activities associated with reconciling their funds. For staff still working remotely during the pandemic, these cloud-based solutions offer secure, streamlined access to do their jobs safely and effectively from home.

Local governments and utilities face the unique challenge of serving every person in the population during a period of major technological transformation. It will serve us all to remember customers’ diverse needs and preferences, and to commit that all people deserve great service and great technology.

Liz Fischer is the chief customer officer for CityBase, where she oversees the company’s client-facing teams. CityBase’s technology helps people find, apply, and pay for public services, and helps staff manage those interactions.

FEATURED CASE STUDIES
Powered By The Atlas
Field Crews Eliminate Paper Workflows in City of La Mesa
La Mesa, CA, USA
Citizens & Town Officials Form Consensus to Update 20-Year Strategic Priorities for Lake Lure, NC
Lake Lure, NC, USA
Asheville Parks & Rec Strategic Plan Boosts Staff Participation & Deepens Community Relationships
Asheville, NC, USA

NEXT STORY: Single Sign-in For Government Services Expands to States, Localities

X
This website uses cookies to enhance user experience and to analyze performance and traffic on our website. We also share information about your use of our site with our social media, advertising and analytics partners. Learn More / Do Not Sell My Personal Information
Accept Cookies
X
Cookie Preferences Cookie List

Do Not Sell My Personal Information

When you visit our website, we store cookies on your browser to collect information. The information collected might relate to you, your preferences or your device, and is mostly used to make the site work as you expect it to and to provide a more personalized web experience. However, you can choose not to allow certain types of cookies, which may impact your experience of the site and the services we are able to offer. Click on the different category headings to find out more and change our default settings according to your preference. You cannot opt-out of our First Party Strictly Necessary Cookies as they are deployed in order to ensure the proper functioning of our website (such as prompting the cookie banner and remembering your settings, to log into your account, to redirect you when you log out, etc.). For more information about the First and Third Party Cookies used please follow this link.

Allow All Cookies

Manage Consent Preferences

Strictly Necessary Cookies - Always Active

We do not allow you to opt-out of our certain cookies, as they are necessary to ensure the proper functioning of our website (such as prompting our cookie banner and remembering your privacy choices) and/or to monitor site performance. These cookies are not used in a way that constitutes a “sale” of your data under the CCPA. You can set your browser to block or alert you about these cookies, but some parts of the site will not work as intended if you do so. You can usually find these settings in the Options or Preferences menu of your browser. Visit www.allaboutcookies.org to learn more.

Sale of Personal Data, Targeting & Social Media Cookies

Under the California Consumer Privacy Act, you have the right to opt-out of the sale of your personal information to third parties. These cookies collect information for analytics and to personalize your experience with targeted ads. You may exercise your right to opt out of the sale of personal information by using this toggle switch. If you opt out we will not be able to offer you personalised ads and will not hand over your personal information to any third parties. Additionally, you may contact our legal department for further clarification about your rights as a California consumer by using this Exercise My Rights link

If you have enabled privacy controls on your browser (such as a plugin), we have to take that as a valid request to opt-out. Therefore we would not be able to track your activity through the web. This may affect our ability to personalize ads according to your preferences.

Targeting cookies may be set through our site by our advertising partners. They may be used by those companies to build a profile of your interests and show you relevant adverts on other sites. They do not store directly personal information, but are based on uniquely identifying your browser and internet device. If you do not allow these cookies, you will experience less targeted advertising.

Social media cookies are set by a range of social media services that we have added to the site to enable you to share our content with your friends and networks. They are capable of tracking your browser across other sites and building up a profile of your interests. This may impact the content and messages you see on other websites you visit. If you do not allow these cookies you may not be able to use or see these sharing tools.

If you want to opt out of all of our lead reports and lists, please submit a privacy request at our Do Not Sell page.

Save Settings
Cookie Preferences Cookie List

Cookie List

A cookie is a small piece of data (text file) that a website – when visited by a user – asks your browser to store on your device in order to remember information about you, such as your language preference or login information. Those cookies are set by us and called first-party cookies. We also use third-party cookies – which are cookies from a domain different than the domain of the website you are visiting – for our advertising and marketing efforts. More specifically, we use cookies and other tracking technologies for the following purposes:

Strictly Necessary Cookies

We do not allow you to opt-out of our certain cookies, as they are necessary to ensure the proper functioning of our website (such as prompting our cookie banner and remembering your privacy choices) and/or to monitor site performance. These cookies are not used in a way that constitutes a “sale” of your data under the CCPA. You can set your browser to block or alert you about these cookies, but some parts of the site will not work as intended if you do so. You can usually find these settings in the Options or Preferences menu of your browser. Visit www.allaboutcookies.org to learn more.

Functional Cookies

We do not allow you to opt-out of our certain cookies, as they are necessary to ensure the proper functioning of our website (such as prompting our cookie banner and remembering your privacy choices) and/or to monitor site performance. These cookies are not used in a way that constitutes a “sale” of your data under the CCPA. You can set your browser to block or alert you about these cookies, but some parts of the site will not work as intended if you do so. You can usually find these settings in the Options or Preferences menu of your browser. Visit www.allaboutcookies.org to learn more.

Performance Cookies

We do not allow you to opt-out of our certain cookies, as they are necessary to ensure the proper functioning of our website (such as prompting our cookie banner and remembering your privacy choices) and/or to monitor site performance. These cookies are not used in a way that constitutes a “sale” of your data under the CCPA. You can set your browser to block or alert you about these cookies, but some parts of the site will not work as intended if you do so. You can usually find these settings in the Options or Preferences menu of your browser. Visit www.allaboutcookies.org to learn more.

Sale of Personal Data

We also use cookies to personalize your experience on our websites, including by determining the most relevant content and advertisements to show you, and to monitor site traffic and performance, so that we may improve our websites and your experience. You may opt out of our use of such cookies (and the associated “sale” of your Personal Information) by using this toggle switch. You will still see some advertising, regardless of your selection. Because we do not track you across different devices, browsers and GEMG properties, your selection will take effect only on this browser, this device and this website.

Social Media Cookies

We also use cookies to personalize your experience on our websites, including by determining the most relevant content and advertisements to show you, and to monitor site traffic and performance, so that we may improve our websites and your experience. You may opt out of our use of such cookies (and the associated “sale” of your Personal Information) by using this toggle switch. You will still see some advertising, regardless of your selection. Because we do not track you across different devices, browsers and GEMG properties, your selection will take effect only on this browser, this device and this website.

Targeting Cookies

We also use cookies to personalize your experience on our websites, including by determining the most relevant content and advertisements to show you, and to monitor site traffic and performance, so that we may improve our websites and your experience. You may opt out of our use of such cookies (and the associated “sale” of your Personal Information) by using this toggle switch. You will still see some advertising, regardless of your selection. Because we do not track you across different devices, browsers and GEMG properties, your selection will take effect only on this browser, this device and this website.