iCash is designed to help cities and other local governments more readily accept electronic payments. Historically, cities have been slow to accept credit/debit cards due to the financial overhead that comes with the transaction. In the traditional retail environment, the merchant accepting credit cards pays a varying portion of that transaction for the ability to accept payment cards. The traditional merchant is able to adjust the price of his product and services to account for the fees.
Over the years, city officials have pointed out several issues with accepting credit cards for city services using traditional retail model.
- The portion of the transaction paid out to accept cards varies greatly, influenced, in part, by the number of card transactions the city does, the kind of card the customer presents for payment and how the city processes the card. Many cities are not comfortable with the unpredictable fees associated with the retail model. Visit the "True Cost of Credit" web site to see how the type of card you present impacts the merchant.
- Some city officials struggle with the opinion that accepting "plastic" means all city taxpayers then begin subsidizing the payments of city customers that choose to pay with a card.
- To keep funds separated, some cities have set up merchant accounts for each city service accepting credit card payments. That approach creates a reconciliation challenge at the end of the month and opens the city up to unnecessary fees for multiple merchant accounts.
Seeing credit card acceptance as inevitable, several cities began looking for solutions to these roadblocks. In 2008, the iCash 28E was created by the cities of Clive, Hawarden, Hiawatha, Humboldt and West Liberty. More than 30 cities have joined iCash since that time. iCash processed its first live payment for the city of Humboldt on January 4, 2010.
Powered by ABC Virtual’s Payment Web, iCash enables cities to take payments on the web, over the phone or in multiple physical locations across the city. All services are provided via the same web application. This allows multiple cities to customize their payment processes, view real-time transaction information and download that information for efficient reconciliation.
iCash gives cities the ability to assess a service delivery fee to the customer, so that the city is kept whole in the transaction. If the city bill is $50, the customer pays $50+ a service delivery fee. At the end of the transaction, the city receives $50. The service delivery fee is used to pay the expenses of the payment portal.