The nationwide introduction of the payment card has been decided at the political level and will be implemented in stages starting in November 2024. Practical examples show that the system can function pragmatically and efficiently. The focus is on the desired efficiency gains in administration. A recent pilot study from the state capital Magdeburg in Saxony-Anhalt provides concrete evidence of this: the use of the SocialCard reduces administrative costs there by up to 90 percent.
Local authorities are coming under increasing pressure: more and more applications for social benefits require careful checks and manual payments – but at the same time, there is often a lack of skilled staff to cope with this workload. Digital solutions can provide targeted relief for administrative staff and municipal budgets. In Magdeburg, the introduction of the SocialCard has significantly reduced processing times – from an average of 15 minutes for manual cash payments to less than 10 minutes for initial card issuance. Once set up, payments are made automatically. Instead of 595 working hours per month, employees now only need 55. This corresponds to a time saving of around 60 hours per employee per month.
The district of Fulda in Hesse is also setting an example with the rapid introduction of the SocialCard, demonstrating how quick and easy it is to implement the digital payment card. District Administrator Bernd Woide explains: “The introduction of the payment card between mid-January and the end of March went smoothly in the district of Fulda. Naturally, this involved additional, one-off effort during implementation, but this was handled well by our employees. It was clear to us that if the technical possibilities for a payment card were there, we would implement it at an early stage. In this way, we were able to issue 600 cards quickly.”
Locally controllable and flexible
The SocialCard is based on a Visa debit card with an individual IBAN. Social welfare offices can load benefits onto the respective card via SEPA transfer. The card can be issued either as a plastic card or as a digital card for use on a smartphone.
This flexible controllability is a key argument in the current debate about possible restrictions on the card. The card can be used both openly and in a controlled manner. Administrations decide for themselves whether, for example, cash withdrawals are possible and, if so, up to what amount. Technical protection mechanisms – such as the exclusion of certain merchant sectors – are also available.
Technically ready for immediate use
“It won’t work without specialised procedures” – an objection that has long been refuted in practice. The SocialCard is already in use at over 350 service providers in Germany: even without full integration into existing administrative systems, the process of issuing and managing cards via the SocialCard Navigator works smoothly and without significant additional effort, as the study with the city of Magdeburg has proven. The connection to specialist procedures is being pursued independently of this.
Relief for payment card users
The SocialCard also makes life easier for benefit recipients: payments are made automatically to the card, eliminating long waiting times at government offices. The card can be used without discrimination and without stigmatisation thanks to its neutral design. Card users can keep track of their account movements via the MySocialCard app, which is available in over 30 languages. They can also withdraw cash free of charge at participating retailers or, alternatively, for a fee at any ATM.
Building block for comprehensive digitalisation
The SocialCard can be used for much more than just asylum seekers. “We also hope to see synergies that will simplify administration – for example, by using the payment card for other benefit recipients who we currently have to pay in cash because they don’t have a bank account. For us, the payment card is another step towards digitising administration,” says District Administrator Woide from Fulda.
Many cash processes can therefore be digitised with the SocialCard. Local authorities are thus provided with a tool that can be used flexibly and transparently in numerous areas of responsibility. The result is a tried-and-tested ecosystem for the digital transformation of public administrations.
Against the backdrop of growing digitisation requirements in German administrations, the SocialCard makes a concrete, tried-and-tested contribution and shows how digital solutions can be implemented efficiently, responsibly and in a citizen-friendly manner. Those who start today will gain time, freedom of action and trust tomorrow – both among employees and service recipients.