As the world becomes more digital, governments around the globe are increasingly turning to technology to solve key nationwide challenges, enhance public services and better serve citizens.

The journey to digital transformation may not always be smooth but the result - to understand citizen needs, combat fraud, and promote economic growth and inclusion, is worth the effort. 

 

Challenge 1: Prevalence of cash in the economy

Accenture’s recent study* shows that cash is the dominant payment method (used at least 5 times per month) worldwide. The global 66% of cash payments are split between Latin America (77%), Europe (68%), Asia-Pacific (63%), and North America (59%).

Traditional cash-based economies can be susceptible to money laundering and illicit activities, making it challenging for governments to monitor and regulate financial transactions.

Suggested solution: National wallet

Launching a solution accessible to all promotes digital payment adoption and the move to a cashless society. Results in payment efficiency, financial inclusion, and economic transparency on a national level.

 

 

Challenge 2: Efficiency and speed of government payments

Outdated payment methods to and from the government and manual processing are time-consuming, costly, and error-prone, and can cause delays, opportunities for fraud and hinder effective financial management by governments. 

Suggested solution: Digital government payments

A national solution for effective disbursement of social and government payments has immediate return and efficiency for beneficiaries. When it comes to taxes, digital tax collection is a convenient option for taxpayers anytime, anywhere. It provides better transparency, contributes to stable and predictable central and local government budgets, and is a step toward creating a cashless economy.

Challenge 3: Interoperability

Governments have a key role in establishing the needed infrastructure for incorporating digital financial services but incompatible technology systems can hinder seamless accessibility. Interoperability acts as a bridge, promoting inclusion and ensuring equal availability of a broader range of financial opportunities for all individuals.


Suggested solution: Interoperable shared platforms

They can be provided to different financial service providers in the country - for agency banking, SME financing, etc. The key digital government solutions can be built on one modern, API-led digital platform as the foundation. Leveraging Big Data from platforms can help governments better understand citizen and business needs and support financial inclusion.

Challenge 4: Limited financial support for MSMEs 

SMEs drive economic growth and employment but often face hurdles in accessing financing and value-add services. Insufficient digital infrastructure and a lack of platforms connecting SMEs with lenders or investors hinder economic growth.

Suggested solution: SME financing platforms

Governments can play a crucial role in supporting small businesses, the backbone of the economy through nationwide platforms specifically designed to meet SMEs’ needs. Such digital solutions can guide SMEs through the process of starting new ventures, securing financing, and fostering growth, while ultimately driving economic prosperity.

Learn more about our digital platform for SME financing and coaching

 

 

Challenge 5: Volume and complexity of forex transactions

As economies interconnect, governments need to maintain sufficient forex reserves to ensure stability and support their domestic currency. Monitoring forex transactions promptly and accurately is essential to curb inflation, prevent excessive outflows, and avoid foreign currency shortages.

Suggested solution: Centralized forex exchange monitoring

A central system can help governments control all stakeholders involved in forex operations nationwide (banks, forex offices, individuals). It can help stabilize the economy, support foreign currency reserves, and maintain a healthy local currency exchange rate.

 

To Wrap it up

In an era where the world is rapidly embracing digitalization, governments across the globe are recognizing the immense potential of technology in addressing crucial national issues. 

By enabling the digital economy through nationwide platforms, governments can accelerate financial and social inclusion, improve tax collection, monitor forex transactions, automate disbursements, support MSME growth, digitize postal operations, and enhance the experience for citizens and businesses.