Business process and document management leader Xerox Corporation (XRX - Free Report) was awarded a $51 million contract to establish an assistance program for the state of South Carolina.
Xerox will provide South Carolina residents with debit cards to allow them access to food stamps or welfare benefits.
State Assistance Program
Under the seven-year contract, Xerox will provide the beneficiaries with electronic benefits transfer cards to link them to the Supplemental Nutrition Assistance Program (SNAP). The re-loadable debit cards will provide funds that can be used for state-approved purchases or cash withdrawals at authorized retailers and ATMs.
Xerox will be responsible for processing transactions, managing retailers and ATM networks, and offering customer support. The contract will extend support to 420,000 residents of the state, with another 20,000 having access to benefits from Temporary Assistance for Needy Families through an electronic payment card solution. The solution will speed up the payment process by using a re-loadable MasterCard debit card.
The company will also install mechanisms to detect any fraudulent activity through a Web-based data warehouse, enabling the state’s SNAP fraud unit to identify suspicious behavior. This system is crucial as frauds in state benefit disbursement result in losses of $6-10 billion annually, with the figures expected to double over the next five years.
Xerox will also provide 70 pre-written reports as part of the data warehouse, so that the state can begin tracking suspicious activity immediately without having to create required reports.
Many states have been updating and modernizing their benefits systems as the number of recipients continues to increase despite economic recovery. Simplifying the benefits delivery process and setting up measures to prevent fraud will reduce administrative burden, improve productivity and result in cost efficiency.
An established leader in such programs, Xerox provides card service programs to nearly 25 million people in 29 states.
Xerox holds a Zacks Rank #3 (Hold). Some better-ranked stocks in the computer & technology sector include Ametek Inc. (AME - Free Report) , Canon Inc. (CAJ - Free Report) and Pitney Bowes Inc. (PBI - Free Report) , each carrying a Zacks Rank #2 (Buy).