Efficient and modern payments: the benefits of government prepaid cards
Australian governments have embraced the evolution in electronic payment methods, implementing the use of electronic transfers in their disbursements and collections. Nevertheless many payments are still made using antiquated systems, and there is significant scope for further efficiency gains from moving to new payment instruments such as prepaid cards.
This Report estimates that switching from current payment methods to prepaid cards for select government payments could provide annual gains in excess of $240 million for Australian consumers and governments. It details the key advantages of prepaid cards over current government payment options including:
- Same day transfer for time-critical payments (such as in emergencies/disaster relief)
- Cheaper than cheques and cash payment for recipients who are unbanked or whose account details are not known
- More effective payment management of consumers eligible for expense reimbursement (such as foster carers and emergency services volunteers)
- Reduced likelihood of fraud and closer monitoring of program spending, replacement of petty cash etc.
Contents of the Report are as follows:
Section 1: Background
Section 2: Government payments mechanisms
Section 3: Potential use of prepaid cards for government payments
Section 4: Quantifying the potential benefits of prepaid cards