Local governments can master the money with payment engine technology
By Mukesh Patel
City and county officials often may feel like credit card companies have them in a virtual headlock. While there may be alternatives that could offer significant cost savings, switching to a new payment processing vendor can be tough.
The payment engine
A payment engine is a processor-neutral operations platform that connects to multiple internal and external payment channels, automating the authentication, sorting and clearing of online payments. Its implementation shields governments from having to change their internal processes to change providers. The payment engine acts as the interface, permitting governments to switch between processors and merchant service providers.
Governments still can collect electronic payments online or at a counter with little staff retraining, software changes or back-office business reengineering. In some cases, because existing merchant numbers can be set up in the payment engine, cities and counties experience no waiting for the new provider to issue new numbers.
By implementing a payment engine, cities and counties not only reduce processing fees and other costs. They “master the money” of electronic credit card and eCheck processing by:
• reducing credit card transaction security concerns,
• greatly minimizing costs associated with PCI compliance,
• simplifying back-end reconciliation,
• easing financial auditing, and
• making it easy to offer mobile payments without having to rewrite code or develop native apps.
Municipal governments should consider several factors in choosing a payment engine:
How adaptable is the payment engine to the agency’s system?
Suitable payment engine technology will integrate smoothly into a municipal payment system, regardless of whether the system processes citizen credit card transactions in real time or through a back-end financial system.
Can the payment engine accept and process mobile payments?
The payment engine should serve as a multi-channel gateway, offering a responsively designed checkout page so transactions can be processed seamlessly, regardless of the device a citizen uses to make a payment. This allows the municipal government to accept payments via multiple devices.
Does the payment engine allow citizens to remit payments to more than one municipal agency at a time?
To make payments to multiple municipal agencies, residents or businesses commonly have to visit each agency’s website and complete their payments individually. A payment engine, however, can enable payments to several agencies in a single transaction. In the reports it generates, the payment engine should separate the payment amounts to make reconciliation easy.
What reporting is provided, and what controls are available?
An effective payment engine offers customer service tools that make it easy to find transactions and answer citizen requests. Reports should be controllable based on roles and user i.d.s within the government entity; that is, available to those who need the transactional information, but not to others for whom the data is unnecessary for job performance. The payment engine also should capture chargebacks, ACH returns and refunds within the system and link them back to the original transactions.
How often are reports provided?
Because municipal agencies sometimes need to respond to customers’ questions, reports should be available at the municipal government’s convenience, not the vendor’s. They should be web-based, available 24/7 and provided in multiple formats, including Excel, Word and PDF.
Payment engines give municipal governments a single-payment platform to achieve significant cost savings, operational efficiencies, better service to constituents – and an effective escape from the payment processor headlock.
Mukesh Patel is the President of NIC Services, LLC, a wholly owned subsidiary of NIC Inc.