DUET Social Card

Business Context
At present, many countries are planning the transition to more modern organizational principles in reference to social security. The social welfare offices are to ensure the accurate and specifically targeted allocations and disbursements from the social budget. Currently the disbursement of subsidies, pensions, and welfare is in cash or paper vouchers. The recipients receive their monthly/weekly payments or vouchers either at the post office, government office, factory or other dedicated locations. Through the cash circulation the funds allocated to social benefits programs are “frozen” and the voucher circulation causes other substantial logistics issues, both methods incurring large operational and administrative costs. These funds could be utilized and spent much more effectively if the simple principle of the dedicated spending of social benefits could be addressed more efficiently. The transition to cashless payments of pensions and other social grants is best accomplished through the introduction of smart cards. In the present fraudulent environment and in reference to the present telecommunication infrastructure in most developing countries, chip cards are the preferred tool as they offer the best levels of security and are not dependant on a constant and fully developed nationwide telecom infrastructure.

System Description
The DUET system leads to neither a change nor complication of the existing payment cycle (social welfare offices, banks, post offices). The most essential difference of the system for cashless disbursement of pensions and social aid is a special card – the card of the employee of the social ministry or a postman which is required for the cashless transfer of the funds onto the card of the client (benefit recipient). The DUET Social Card Solution is an offline payment platform that does not require a constant connection between the service points and a main host (server holding the database of the system) for payment transactions (utility payments, pension disbursements etc.). This technology is based on the principle of direct card-to-card interaction without requiring third party authorization; therefore the POS terminals in retail locations and the ATMs function autonomously. This reduces the requirements in regards to capacity and performance of expensive hardware, (as in servers and automated workplaces), quality of telecommunication lines/infrastructure and therefore reduces implementation costs and total cost of ownership whilst at the same time providing the utmost levels of functionality, flexibility and security. The offline product conception (card-to-card TRX, mobile, low-cost POS terminals), in regards to operational costs, offers an overall favorable economic platform for the system to be implemented speedily and with adequate coverage. A social benefit recipient with a very low pension/subsidy spends his money in small transactions for everyday purchases e.g. bread, milk, medicine. Such transactions of respective volumes of a few Euros cannot be operated profitably with standard online products.
The cashless disbursement of subsidies and pensions using DUET smart cards ensures a spending of the subsidy on those items deemed to be essential for the recipient of the social benefit. Authorized merchants (supermarkets, coops, pharmacies, doctors, et al.) offer the holders of pension and social cards specific predefined benefits and/or price discounts, which are settled or refunded by the merchants retrospectively via means of local tax exemption, transfer from social benefit funds or similar arrangements. The DUET Social Card System enables an exact automated control over specific expenditures in relation to social programs that are undertaken. Nowadays government and municipal agencies offer financial support to lower income groups but have no information on the way in which these funds have been spent i.e. for what goods and services. The DUET Platform offers several control mechanisms for directing the spending to specified and predefined goods and services. Last, but not least, the system increases the security of their owners and precludes the illegal handlings/dealings against offices and other entities that have to deliver or administer large sums of value (e.g. theft during delivery of cash to remote villages and towns and/or theft from the postman or government official disbursing the funds, amongst other cash-related risks).

Benefits

• The DUET Social Card offers an efficient disbursement of social benefits (e.g. discounts when paying for basic goods and services) which are an important political and social factor manifesting a social policy for every citizen dependant on social funds
• The principle of dedicated expenditures for basic foods and products, medicine and medical care can be realized and controlled.
• The secure and reliable data on all information in regards to social benefit services completes and perfects the whole system of social welfare.
• The running costs of social welfare offices are reduced and shifted. Long queues of people waiting to get information on their welfare payments and requiring any additional information on their respective benefits are eliminated.
• Tax collection is facilitated and automated, thus reducing costs. The tax authorities have a reliable and complete data tracking.
• For government/postal offices: No risks are taken any longer as the handling of large sums of cash are eliminated and the areas of error that occur with manual handling and calculation.
• Cashless payments for goods and services increase the security of cardholders, reduce the danger of criminal actions against them and reduce the fraud risk they are exposed to from merchant and service provider personnel.
• The information about credited pensions, grants and last activities can not only be performed in the social welfare offices but also at self service points or at ATMs, and in the branches of the participating banks
• The customers are not restricted to a specific post office or branch and also not to a specific date in order to receive their pensions and other benefit payments. One is flexible in both time and location from where to retrieve their benefits.