The federal government’s payments web portal for collectingpayments to federal agencies, Pay.gov, is now offering digital wallets paymentoptions through PayPal and Dwolla. Theadvantage of these two digital wallets allow users to make transactions via theinternet without supplying their personal information. Pay.gov enables payment of hundreds offederal government agencies with regard to loans, medical expenses, fines,violation or penalties, debt, national park service fees or fines, training orconference fees within these categories and in the following areas of thefederal government including Department of Veterans Affairs, Small BusinessAdministration, Department of Defense, United States Courts and United StatesCoast Guard.
In 2014 the Treasury Department collected $3.7 trillionthrough 400 million transactions using pay.gov and other programs. Pay.gov currently experiences over $110billion in collections and in excess of 100 million transactions lastyear. The benefits for the federalgovernment boils down to enabling payments more easily and securely for thecustomer and cost effectiveness through technology, authentication schemes andreal-time payment platforms for the government.
“Digital wallets provide convenience, simplicity,and a trusted customer experience, while achieving cost effectiveness for thefederal government,” Corvelli McDaniel, the Treasury unit’s assistantcommissioner of revenue collections management, said in the release.”
From our vantage point this is movement in the rightdirection for the federal government. Thesesteps allow greater efficiency and lower cost transactions, but at the sametime enabling consumers and companies to pay the federal government in themethod preferred by the payer. Weanticipate there will be more options in terms of real-time digital payments (watchfor PayNet and Now Network) incorporated within federal and state governmentcollections in the not too distant future, with P2P payment mechanisms beingtransformed into P2G and B2G.
Overview by Ron Mazursky, Director, Debit Advisory Service for Mercator Advisory Group
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