Government agencies, municipalities, and public ally funded educational institutions face extraordinary revenue challenges, especially in the COVID-19 era. But recent innovations now make it easy to deploy “revenue neutral” solutions. These can accelerate collection rates and control taxpayer-funded payment processing costs. Revenue neutral transactions enable agencies and institutions to reduce overall time, expense, and labor, with greater transparent accountability to constituents.
States, municipalities, and other government entities process payments for a variety of reasons, all year long. That includes property and vehicle taxes, speeding tickets, child support payments and assessments, professional licensing fees, court costs, and tuition payments to public colleges and universities. The credit card transaction fees accumulate and represent a significant loss of revenue. Typically, government agencies assess a flat-rate convenience fee charged across the board. They do so to recoup some of the high cost of credit card processing. But when the cost is averaged out and charged to everyone, that can alienate taxpayers who may bear no responsibility for the credit card processing costs.
But with revenue neutrality, the taxpayer using a debit card, check, or cash incurs no convenience fee. The process is fully disclosed and transparent to all payers, so constituents have full control over whether they want to pay the credit card convenience fee or use another payment method. That inspires greater cooperation and compliance, which makes collections easier and more timely, to save even more taxpayer dollars.
These turnkey solutions don’t require additional infrastructure investment or IT expertise. Each time a credit card is used to make a payment, special turnkey plug-in software instantly identifies it as a credit card. Then it passes the credit card processing fee along to the person paying, as a line item convenience fee appearing on their receipt. Agencies and institutions retain 100% of the amount billed, paying zero credit card fees to companies like VISA and MasterCard. The process is fully transparent, safe, and secure, offering advanced features such as encryption, tokenization, and Level 3 PCI compliance.
This can be done through a secure online digital payment platform. Revenue neutral systems are compatible with various hosting architectures and accounting systems, and can be fully integrated to make expanding the system to other agencies easy. Taxpayers can make payments 24/7, 365 days a year. They can even use their handy mobile devices to make payments and view their statements and accounts. Automated electronic invoicing makes the process efficient, effective, and facilitates compliance with environmentally responsible paper reduction initiatives. All of this is done seamlessly, with real-time reporting and tracking and secure cloud-based backup.
Building Public Trust
A revenue neutral payment policy helps build public trust and instills taxpayer confidence in government oversight and financial prudence. These are essential for the success of government agencies and municipalities, particularly in times of uncertainty. The public relies on the government for safety, honesty, stability, and reassurance. Revenue neutral payment systems are one easy way to provide evidence of that support and fiscal responsibility and accountability.