Administration of Government Subsidies Using Contactless Bank Cards

Subsidization of major and minor government branches is common strategy with the aim to optimize government funds, increase residents’ welfare and overall infrastructures’ efficiency, including public transportation system. Within the different countries subsidization is being approached using specific models of calculation and payment. However, most of them use the same subsidy administration approaches – cash transfers or social services. The aim of this paper is to describe proposed improvements of transport subsidy administration approach by implementation of e-cards for payments. It is proposed to improve subsidy payment procedure by promoting that subsidy should be paid directly to subsidy receiver. This will allow managing only real transactions and only subsidy receiver is interested in subsidy utilization. Proposed approach to process the subsidy administration and payments can be realized by using existing banking infrastructure and novel product as electronic cards.

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