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PayIt Officially Signs First Non-U.S. Contract With Toronto

The company, which provides digital services and payments, has completed the deal after a year of skepticism and criticism from local tech vendors and advocates. It plans to make the first services live in the fall.

Toronto, Canada
Toronto, Canada
PayIt, a Kansas City-based startup offering digital services and payments to state and local government, has officially signed its first client outside the U.S.: the city of Toronto.

The deal comes after a yearlong, somewhat contentious process; Mayor John Tory recommended PayIt for a large digitization effort in the summer of 2020 but ran into resistance and skepticism from local tech vendors and public advocates. PayIt will help the city offer services and payments such as property taxes, parking tickets, permits and licenses online. The work will happen in phases, with the first scheduled to go live in the fall.

“Through this new service we can now better meet people’s expectations for a modern government and create more value for residents and businesses, similar to how they interact with their banks, retailers and increasingly the public sector — simpler, more convenient and increasingly personalized,” said Deputy Mayor Stephen Holyday in a press release.

PayIt works by giving users an interface more modern than many government agencies offer, then connecting to agencies’ back-end systems to handle the data, making it possible to update the process a resident goes through without the government engaging in a massive overhaul of its technical infrastructure. The interface can take multiple forms, but a popular option is to use a chatbot to walk users through whatever process they’re trying to complete.

The system also creates a “digital wallet” for users so they can use the same payment information for multiple purposes, and it can send renewal reminders to users.

Fresh from the collapse of Waterfront Toronto, the ambitious multibillion-dollar smart city plan Toronto had engaged in with Google affiliate Sidewalk Labs, the PayIt contract met with some local criticism. Bianca Wylie, a senior fellow with the Centre for International Governance Innovation, wrote that the deal was too large, too prone to vendor lock-in and expensive. Tech Reset Canada, of which Wylie is also a member, wrote that the procurement happened as a result of an unsolicited proposal and said the city has yet to complete its digital infrastructure plan.

Following PayIt’s usual business model, the company will set up the digital services for free, then earn revenue by charging transaction fees. The deal also includes a provision allowing other Canadian governments to hop onto the same contract, which would lower the fees for Toronto. In that sense, it’s like a cooperative purchase, except that the purchasing is happening ahead of any possible cooperation between governments.

Matthew Moloney, director of marketing communications for the company, wrote in an email to Government Technology that it’s a model the company has used elsewhere, such as in Kansas, where counties offer their residents the ability to pay property taxes through the state’s PayIt portal.

The Toronto contract is for three years, with the city having two optional one-year extensions available.