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Fintech loves velocity. Every headline touts faster payments, instant credit, or frictionless checkout. Yet the most dependable, recession-resistant cashflows in America move not through consumer apps but through city and county finance offices.
In FY 2021, state and local governments collected more than $4.1 trillion in general revenues, according to the Urban-Brookings Tax Policy Center, which draws from U.S. Census data — a sum that includes taxes, service charges, and fees (Tax Policy Center, “State and Local Revenue,” 2021).
Much of that money still travels through paper checks, in-person counters, or aging portals.
I call that an overlooked fintech frontier hiding in plain sight.
What’s Already Working
The policy guidance, constituent demand, and payment rails already exist.
The Government Finance Officers Association (GFOA) urges local governments to use electronic methods to make and accept payments whenever possible, with published best-practice controls for card acceptance and reconciliation.
And the National Association of Counties (NACo) found that counties processing tens of thousands of paper checks annually could save hundreds of thousands of dollars by migrating taxpayers online.
Citizen demand is clear: Surveys show that residents expect digital options for permits, utilities, and tax payments. Payment networks like RTP® and FedNow℠ now make real-time settlement, disbursement, and refund use cases possible for governments.
The infrastructure is ready. What’s needed is decisive adoption.
Where Local Governments Should Start
Local governments shouldn’t nibble at the edges — they should begin with the high-volume, predictable, citizen-facing revenue lines that deliver quick wins in efficiency and trust.
Building & Permitting (applications, plan reviews, inspections, impact fees)
This is the ideal proving ground. The process touches every contractor and property owner and generates frequent transactions.
Digital transformation in building departments is no longer limited to big cities with deep budgets. Across the country, communities of every size are modernizing how money moves — proving that scale is no longer a barrier to efficiency.
The City of Phoenix, with more than 1.6 million residents, now processes permitting and plan-review payments entirely online through its SHAPE PHX system, handling thousands of daily transactions. But the same technology advantages are appearing in places like Fort Lupton, Colo. (population ≈ 8,000), where the city moved nearly all permit applications and payments into its building department’s online portal. For smaller communities, the payoff is immediate: Less paper, fewer walk-ins, faster reconciliations, and staff time reclaimed for service delivery.
Large jurisdictions, by contrast, view digital payments as an exercise in scalability and transparency. Cities like Washington, D.C., and Santa Fe, N.M., use their online portals to manage vast volumes of permits and fees while giving residents real-time visibility into application status and receipts.
Whether serving 8,000 or 800,000 residents, these governments share the same objective: To make the process of building, inspecting, and paying as seamless as the digital experiences citizens already expect elsewhere. In both cases, the ROI is the same — fewer manual steps, faster cash flow, and greater trust in how public money moves.
Two different jurisdictions — an Eastern county and a Western municipality — prove the same thing: Civic fintech works coast to coast.
Utilities (water, power, solid waste)
Utility billing is predictable and recurring. Moving to ACH, card, or wallet payments reduces delinquencies, accelerates cash flow, and enhances user satisfaction.
Licensing & Code Enforcement (business licenses, short-term rentals, contractor registration)
These are perfect for “apply-approve-pay-renew” digital loops with reminders and auto-pay, reducing walk-ins and missed renewals.
Property & Local Taxes (quarterly or semiannual)
Counties adopting portals with multiple digital tenders have reported ten-fold increases in online tax payments within a few years.
Impact and Development Fees, Public Works Permits, Inspection Fees
Often small individually but large in aggregate, these fees are natural extensions once permitting is digitized.
Start here. Prove it works. Then scale.
Why It Matters for Finance Officers — and for Fintech
For municipal finance teams, digital payments deliver measurable ROI — but only when third-party payment platforms are tightly integrated with the city’s ERP or financial system of record. Without that connection, the benefits of digital acceptance stop at the payment gateway.
Here’s why:
- Lower cost per transaction. NACo case studies show substantial savings from reduced printing, mailing, and manual reconciliation — especially when payment data automatically flows into accounting ledgers rather than being rekeyed by staff.
- Faster cash application. True acceleration happens when digital payment platforms exchange data with ERP systems via secure APIs or posting files, ensuring deposits, fee codes, and journal entries align automatically. This linkage improves daily liquidity, reduces timing gaps, and eliminates handoffs between departments.
- Built-in controls and transparency. When payment and ERP systems are connected, each transaction carries metadata — payer, permit number, timestamp, and purpose — creating an end-to-end audit trail that meets GFOA and state reporting requirements.
For fintech innovators, civic payments represent a large, recurring, zero-credit-risk market — but success depends on mastering the integration layer, not just the user interface. The leaders in this space will be those who bridge the last mile between constituent-facing portals and government back-end systems, bringing to civic finance the same reliability and automation that revolutionized payroll and card processing.
A Practical Roadmap for Cities and Counties
Modernizing civic finance doesn’t have to start with a moonshot. It can – and should – start with a manageable plan. The following roadmap gives local governments a practical framework for digitizing core revenue functions, improving payment flexibility, and freeing staff from reconciliation and manual work.
Each step can be implemented within existing statutory authority and current systems, making modernization attainable even for resource-constrained municipalities.
- Pick two revenue lines (e.g., permits + utilities) and make them fully digital within 180 days.
- Adopt “no-wrong-door” acceptance: ACH, debit, credit, wallets. Default to the lowest-cost tender; post clear fee policies.
- Integrate with the ERP. Automated posting files and same-day reconciliation reduce staff hours.
- Offer installments and autopay. Many jurisdictions already authorize ACH-based property-tax or utility plans.
- Pilot instant payments. Use RTP or FedNow for same-day permit releases, instant refunds, or delinquent-tax cures.
- Publish transparency dashboards. Report channel mix, settlement times, refund SLAs, and accessibility metrics.
Answering the Skeptics
Even the most forward-thinking modernization plans face pushback. Budget officers, treasurers, and IT leads often hear familiar objections rooted in legacy processes and past vendor experiences. But most of these concerns no longer hold true in today’s payments environment, especially when cities take a phased, data-driven approach.
Below are a few of the most common myths and how to address them with practical, compliant solutions.
“Card fees are too high.” Offset with tender steering (ACH default), convenience-fee models, and volume pricing; GFOA outlines compliant structures.
“Residents won’t use it.” Data shows otherwise. Once promoted properly, digital adoption typically doubles within a year.
“Integration is too hard.” Not if scoped right. Begin with two revenue lines, select API-ready vendors, and demand measurable posting accuracy.
The Leadership Moment
When people hear fintech, they picture neobanks or sleek cards. I picture a line at 3:55 p.m. in a municipal building, a cashier closing a drawer of checks, and a finance director reconciling by hand.
That’s where innovation now belongs.
If you lead a city, county, or township, set a measurable target: Migrate 60 to 80 percent of eligible receivables to digital channels within two years, and publish your results. The technology exists. The policy support is in place. The public is ready.
And if you build fintech? Stop chasing only consumers. The next breakout product won’t mint a new spending habit — it will make government money move with speed, clarity, and trust.
Photo by Tima Miroshnichenko from Pexels
About the author: Joseph G. DeRosa is the President and Chief Revenue Officer at SAFEbuilt, where he leads national sales, marketing, client success, and communications teams under a unified growth strategy. With more than 20 years of leadership experience across SaaS, fintech, financial services, and technology, he’s known for guiding organizations through transformation and growth.
Joe is the author of The Customer Mindset and serves on multiple software company boards, advising on go-to-market strategy and leadership development. His career has taken him around the world, shaping a leadership philosophy rooted in empathy, clarity, and continuous learning. Outside of work, he’s a husband, father, and lifelong student of history, fitness, and personal growth.
