Fast, simple, secure – the shift to digitizing government services during the pandemic

The COVID pandemic has changed the way we live, work and socialize in dozens of ways. We’ve attended weddings, funerals, and graduations over Zoom. We made major purchases – like cars and houses – after virtual tours and without any physical in-person visits. While some of us look forward to resuming hugs from loved ones at big family celebrations, others welcome the (perhaps permanent) shifts towards flexibility and digital connection that the pandemic has brought.

One of the biggest changes we’ve seen during the pandemic has been in the way governments deliver services to citizens and businesses. Almost every industry has moved its operations online to meet shutdowns and social distancing requirements – from retailers to healthcare providers. US Mastercard SpendingPulse data for March 2022 revealed that e-commerce grew from 12% to 18% of commerce virtually overnight during the pandemic and is currently holding at that level.

Much like 7-Eleven and Whole Foods, governments have also made the very rapid shift to providing digital services to their citizens and businesses. Whether applying for a business license, paying a parking ticket or obtaining a passport, people who previously visited the post office or town hall could now make dozens of requests and purchases from government from the comfort of their homes. It has been a sea change in the way citizens and businesses interact with their governments.

With nearly two years into the pandemic, it’s worth taking a step back and seeing what we’ve learned during this shift – and what we can do to bring the best elements of this shift while minimizing the challenges and risks in the future.

  1. Most citizens and businesses love the convenience of digital government services – even those who thought they wouldn’t at first. For many, the change happened almost overnight and was not always welcome – many were still seeking the option of visiting a government office to address their needs or concerns. However, once necessity compelled them to make the switch, citizens and businesses were often surprised at how convenient and simple it was to register, apply and pay for services online. Who knew that renewing your license or applying for a business permit could be done from the comfort of your own home? Recent research by Deloitte showed that the use of in-person government services has halved in APAC countries over the past two years, and 77% of citizens now primarily use a digital platform to access government services. Similarly, the Boston Consulting Group found that Gulf Cooperation Council governments, in particular, have excelled in the provision and adoption of digital services in recent years, with an average adoption rate of 61.3 %, more than 30% above the world average. Globally, millions of people have changed their behavior – and they’re not looking back.
  • Post-reopening, a hybrid model of digital and in-person offerings has often been welcomed by governments and citizens. As governments have been able to reopen their offices, we have seen that many citizens and businesses are taking advantage of the choice of digital and in-person channels to obtain government services. For example, they may choose to conduct a business registration in person so they can ask questions or get advice on complex business matters, while performing simpler recurring transactions (such as paying quarterly business taxes) on line. Likewise, having a hybrid model allowed government to choose when and how to push citizens and businesses to each channel based on government needs. A simple driver’s license renewal can now be done online with basic validation techniques, while a more in-depth review and test for a new license may need to be done in person.
  • Access to safe and secure digital payments is key to enabling this transition to digital. The governments that have been most successful in continuing to serve their citizens through digital channels are those that have been allowed to accept digital payments at the point of payment – allowing the individual or business to register, to share their information and to pay for the payment. service in one go rather than filling out online forms and sending payment separately. The more governments continue to turn to digital services, the more they will have to accept various digital payment methods. At the same time, it will be crucial, from an equity and inclusion perspective, to equip citizens and businesses with digital payment tools. Digitizing person-to-government payments can reduce administrative costs, improve transparency and increase government revenue by broadening the collection base. For example, when the Cambodian Ministry of Works and Transport (MPWT) introduced mobile money as a payment method, its revenue increased from 60 billion riels ($14.8 million) in 2017 to 150 billion riels. riels ($37 million) in 2019.[1].
  • Creating and verifying digital identity is a crucial tool to help governments reduce fraud and deliver efficient services. One of the biggest concerns with moving to online channels is the potential for fraud. How can we tell if a small business is what it’s supposed to be if we can’t visit its storefront in person? How do you know if a citizen applying for a passport is who he claims to be? Some governments have dramatically increased their investments in tools that enable digital identification during the pandemic, and those investments have helped them take leaps and bounds to serve their citizens and businesses online. For example, to reduce fraud, some governments such as Singapore have created a unique digital business identifier for use across all branches, minimizing the potential for fraud while maximizing ease and efficiency in serving legitimate businesses.[2].
  • Cybersecurity for governments has become increasingly important and demanded by citizens and businesses. As individuals and businesses began to share more private information via computers and cell phones, rather than on paper, they demanded that this information be handled with the highest levels of security. This is all the more relevant considering that cybercrime has traditionally increased in times of flux, such as economic downturns, and that cyber incidents and cybercrimes increase when there is a change in technology.[3] Reports of identity theft in the United States. more than doubled between 2019 and 2020, to 1.4 million, according to the Federal Trade Commission. Cybersecurity is no longer an asset, but rather a key part of any digital government infrastructure.

In short, the past few years have been exciting, challenging and constantly surprising as governments and their stakeholders have transitioned to digital channels to serve their citizens and businesses. Are we taking our future driver’s license tests in the Metaverse? Maybe. But what we know for sure is that the transition to digitalization is here to stay – and the most successful governments will be those that learn from the pandemic in designing and implementing future services.



Olga LaBelle, Vice President for Government Engagement at Mastercard

Olga LaBelle leads strategic and operational work for the government engagement team at Mastercard. In this role, she identifies opportunities for Mastercard to partner with the public sector on key strategic topics – including financial inclusion, economic development, support for small and medium enterprises and support for the economic recovery of sectors. keys such as tourism.

Prior to joining Mastercard, Olga was at the Boston Consulting Group, where she focused on public sector, social impact and education. She helped develop the topic of total societal impact, helping companies use social and environmental needs as a lens for strategic growth and long-term competitive advantage.

Olga holds a BA in Political Science from Yale University, an MBA from Harvard Business School and a Masters in Public Policy from Harvard Kennedy School of Government.

Ashley C. Reynolds