In a previous blog I presented four use cases for Real-time Analytics within the context of the Social Protection industry. Real-time capabilities, enabled by technologies such as SAP S/4HANA, can also be applied to transform core business processes. In this blog I will investigate the impact of Real-time Payments on the citizen experience of interacting with a Social Protection agency.
Information systems have dramatically reduced the processing time for benefit payments, through the use of computers and electronic messaging between the Social Protection agencies that make determinations and the Reserve/Central Bank that processes payments. Further improvement, to realise the opportunity for citizens to receive payment into their bank accounts immediately upon determination of their eligibility and entitlement, requires application of real-time technologies at both the agency and the bank. To rationalise this investment, let's investigate how processing benefit payments in real-time can enhance the citizen experience, simplify agency processes, and ultimately improve social and economic outcomes...
Benefits for Citizens
Social Protection payments are intended to provide a ‘safety net’ for people in vulnerable social and economic circumstances. To stretch the analogy, the safety net should feel secure and give the person a sense of stability in a situation that might otherwise be quite unstable. Delivering payments to citizens in real-time presents an opportunity for Social Protection agencies to provide immediate stability through financial support.
For people at risk, money in the bank today is worth so much more than an assurance of support tomorrow, because it provides something very important to them in their situation – certainty. With certainty of support, people can immediately set about executing their ‘Plan A’, without having to resort to ‘Plan B’. For example, having a little money to tide them over while searching for a job could give a person the confidence to apply for fulltime positions that advance their career, rather than taking on temporary or part-time work to make ends meet.
It's worth noting that in special circumstances, some Social Protection agencies have the ability to rush through particular payments, or they may give cash to people in emergency situations. The agency might also allow people to collect an advance on future benefits to cover expenses. These can be thought of as ‘early interventions’, with the objective of preventing serious situations from becoming dire. Real-time payments can also be considered a form of early intervention, and in some cases could alleviate the need for emergency payments or payments in advance.
Benefits for Agencies
Interacting with people in vulnerable social and economic circumstances can be difficult for agency Front Office and Call Centre staff, partly because people can be frustrated by the amount of effort it can take to get the supports they need and to which they are entitled. The ability to deliver payments in real-time has the potential to improve these interactions by increasing the efficiency of the application-to-payment process, and by giving people the certainty of knowing that money is in their bank account before they conclude their interaction with the agency.
Real-time payments capability also has the potential to reduce the volume of calls to agency Call Centres. Typically, a large proportion of calls relate to payments (when will I receive my next payment and how much will I receive; why is my most recent payment amount different than the one before; how much will my payment be reduced by as a result of my partner's change-in-circumstance; etc). The relative cost of Call Centre versus Online servicing prompts many Social Protection agencies to provide Web-based citizen self-service facilities to answer these standard questions. But if payments can be delivered, reviewed and discussed at the time of determination, there may not be a need for the citizen to call back or check in later.
Another potential benefit to Social Protection agencies is the opportunity for real-time payments to distribute the load of payment processing. Typically pending payments are placed on hold, consolidated and submitted in batch for disbursement, resulting in costly processing spikes as IT infrastructure spins up in response to what is essentially an artificially created load. While there will always be a need for batch jobs, processing even a portion of payments in real-time throughout the day has the potential to reduce the volume of payments that need to be processed at peak times.
This blog has investigated the potential benefits of Real-time Payments for citizens and agencies within the Social Protection industry. This is just one example of how real-time capabilities, enabled by technologies such as SAP S/4HANA, can be applied to transform core business processes.