Blackhawk Network finds four priorities local governments should consider when providing funds to people in need
Since 2020 there have been significant increases in the need for ‘alternative payment’ such as voucher schemes and prepaid cards, to deliver financial support to people in need, as opposed to traditional methods such as cash, cheques or BACS. Blackhawk Network actively provided pandemic emergency relief support and helped to issue more than $2.5 billion in 2021 alone. As we continue to battle the cost-of-living crisis and enter a recession, Blackhawk Network uncovers how local governments can best support in distributing funds and presents vouchers as a positive solution for communities hit the hardest by the current climate.
The research included input from over 1,000 lower-income individuals who received the funds last year. It found almost all (97%) were concerned about making ends meet and a need to support them with utility bills (82%), food (67%) and rent (44%) as a priority during the cost-of-living crisis.
While many people in need are feeling the strain of the current economic climate, local authorities must consider the most effective ways to reach those in need and help overcome their own challenges. The research defines four priority areas that communities would appreciate most:
- Speed to accessing funds: Research found 30% had received a voucher within a day or two but only 11% had to wait more than two weeks. While for cash, this was significantly higher, with 17% waiting two or more weeks.
- Ease of claiming: Vouchers were considered by 71% of the respondents to be an easy way to claim support over pre-loaded bank cards, direct or cash transfer and cheque. 81% agree ease of claiming is essential.
- Choice: 84% of respondents wanted to see some level of control over what the support is spent on with utility bills and food being the most appreciated.
- Ease of spending: Only 7% of participants believe that spending vouchers would be very or fairly hard.
Additionally, insight into national policy makers and local authority representatives highlighted the challenges they face. Resourcing means many authorities aren’t geared up to deal with the volume of disbursements from grants and crisis funds. It can also become a significant administrative burden, with lengthy back and forth regarding financial information. Different methods to distribute funds can also vary in cost-effectiveness, with some, such as BACS, incurring additional transactional fees.
Ultimately, vouchers gained the most positive response when thinking about being awarded funds from local authorities or organisations. While local authorities said it significantly helped alleviate many challenges when using a third-party provider to disburse payments via vouchers.
Chris Ronald, VP EMEA B2B at Blackhawk Network said: “During incredibly testing economic times, we are conscious of the financial struggles communities across the UK are facing, which is why it’s essential that those need help most are receiving support quickly and with ease of access.. While local authorities may not have the resources or tools in place to manage fund distribution effectively, alternatively payment solutions should certainly be considered, and vouchers are an option that ticks all the boxes. They’re an effective way to reach the right people quickly and in a way that’s convenient to them.”
For more information about the research and how to act please download the eBook: blackhawknetwork.com/uk-en/resources/ebook-speeding-payments-people-need
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