WASHINGTON, Aug. 3 — Electronic systems that make government payment programs more efficient, safer and transparent can slash administrative costs by up to 75 percent, the World Bank said Thursday.
Millions of people in developing countries worldwide receive their salaries, benefits and pensions through government-to-person (G2P) payments. But in many cases, they are not being delivered in a cost-efficient way, the Washington-based global development agency said in a new report.
The report focuses on cases such as Brazil's "Bolsa Familia" social safety net program, where the government has saved 75 percent on administrative costs by going electronic. Bolsa Familia brought universal coverage to 12.4 million low-income individuals, representing about 30 percent of the nation's population below the poverty line.
"Only 25 percent of low-income countries process cash transfers and social benefits electronically and this percentage is only slightly higher for public sector salaries and pensions. This means that many governments are stretching limited resources, and spending more than they should on paying benefits and salaries," said Gaiv Tata, World Bank Director for Financial Inclusion Global Practice. (PNA/Xinhua) CTB/rsm