Today, it’s generally assumed that cash has been replaced by digital payments. But according to a study by the U.S. Federal Reserve cash is still the most used form of payment, accounting for almost 30 percent of transactions. With this knowledge in hand Arizona’s Department of Transportation launched a new service that made it easier for customers to make cash payments.
Visiting the Department of Motor Vehicles (DMV) to renew your driver’s license or vehicle registration doesn’t strike many people as a fun day out, more like a laborious and unpleasant chore. However, paying the DMV doesn’t have to be difficult — I can almost see the skeptical frowns on readers’ faces, so allow me to elaborate. Forget waiting in long lines in-person or navigating an online portal. Instead, imagine a scenario in which people can handle basic motor vehicle transactions while buying groceries or going about their normal lives.
For residents of Arizona, a robust payments network makes this convenience a reality. By combining “new school” digital payments and “old school” cash payments, Arizona’s Department of Transportation offers an insightful use case in proving that everyone can win at the Motor Vehicle Department (MVD).
Digital Grows But Cash Isn’t Dead
As government offices across the country closed because of COVID-19, there was an important shift for government entities to make payment offerings more accessible and comprehensive for customers. This meant doubling down on growing consumer preferences for digital payment methods, yes. But many still want to use cash. In fact, cash remains the most used form of payment, representing over 30 percent of transactions, according to a report, “2018 Findings from the Diary of Consumer Payment Choice,” conducted by the U.S. Federal Reserve.
Cash offers the convenience of paying in person and is viewed by many as the fastest and most secure payment option. The statistics bear this out: In-person payments comprise almost 20 percent of bill payments made to government entities — twice as much as other industries.
Balancing Payments at the MVD and Alternate Locations
Accepting cash payments is a win-win for customers and the government entities that benefit from reduced costs, improved efficiencies and increased customer satisfaction. But the pandemic highlighted at least two important questions for government entities like Arizona’s Department of Transportation:
• How could they still collect cash payments if their offices were closed?
• Which payments were simple enough to be facilitated at an alternate location versus more complex payments that need to be handled directly at the MVD?
Arizona answered these questions by partnering with a walk-in bill pay processor that allows customers to renew their vehicle registration with cash or debit at retail stores including Walmart. By providing this option, the state’s Department of Transportation redirected a portion of motor vehicle transactions to be handled at alternative locations – freeing up MVD personnel to support other needs and reducing wait times for other customers.
The results speak for themselves. Three months into the program’s adoption, Arizona announced that hundreds of customers had processed a payment without visiting a motor vehicle department office — proof of a holistic payments offering across cash and digital.
Digital payment methods will continue to increase, but cash payments aren’t going anywhere. And by allowing for certain payments to occur at alternative locations, government entities like the MVD — or the DMV as it’s often called — can balance the payments ecosystem in a way that allows everyone to win.
Steve Ostroff is General Manager, BillMatrix and Walk-in Payments, Fiserv.