Prepaid cards allow local and central government to distribute benefits to their citizens in an efficient and secure manner. Prepaid card solutions are ideal for recurring benefit payments such as pension, unemployment benefits, housing benefits, and incapacity benefits as well as emergency one off payments such as disaster relief payments.
- Public sector benefits:
- Increase efficiency and reduce administrative processes.
- Remove the need to use paper voucher, cheque and cash systems to disburse payments and therefore reducing fraud as well as the need for 3rd party distribution channels.
- Easy and cost effective distribution of payments to citizens on a national or regional basis.
- Improve control with access to superior information to prevent fraud and by restricting where funds can be spent.
- Ability to set clear budgets for specific compensation projects and monitor usage.
- Once deployed a prepaid card solution can easily deliver both recurring and exception payments as well as low and high value payments.
- Effective for segments of the population without or restricted access to bank accounts such as the financially excluded and transient segments of the population.
- Benefits to citizens:
- Allowances are quickly and easily available to spend or as cash via ATMs.
- Removes the need to wait at distribution outlets (local offices and post offices) for cash or cheque payments.
- Stigma of receiving benefits is relieved through use widely acknowledge and accepted payment card brands.
- Establish a first step for financial inclusion by using the prepaid as an alternative to bank accounts.
- Expensive cheque cashing fees and high cost subprime financial services are avoided.
- Multiple benefits can be paid onto one card.