GovTech profitability: an excellent business for governments

Profitability in this busy 2020 has been severely hit by the unusual timing. The pandemic wreaked havoc on the economy and governments around the world had to take on expenses they did not foresee.

However, the digital transformation of governments has accelerated, demonstrating that the use of GovTech platforms is a profitable business. This is a topic addressed by the Andean Development Corporation (CAF) when analyzing two applications that fall within the segment of digital services focused on the government sector.

GovTech profitability in figures

The first startup studied is focused on government digital platforms and open innovation, helping to create new channels for citizen participation and interaction between different sectors and ordinary Colombians.

This alternative was developed for the Colombian Ministry of Information Technologies and Communications (MinTIC) and its purpose is to allow the creation and management of territorial websites of the Colombian State.

This resulted in the collection of 2,643 websites of local entities, with high rates of use and exploitation by citizens and subnational governments, CAF added.

In figures, this platform has a cost-benefit ratio of 150.8, which indicates that for every peso that the National Government invested in the platform, in a 5-year horizon the Colombian State receives 150 pesos of monetary benefit in return, according to CAF data. The GovTech profitability of this platform demonstrates the additional benefits that adopting this type of technology brings to governments. 

The second tool is a startup that specializes in data science and digital platforms, which has helped the government develop new platforms for using, visualizing and downloading data on matters of public interest.

In this opportunity, an alternative was created for the organization Transparencia por Colombia (TpC), whose evolution has been supported by the MinTIC. Its importance has been decisive, even this platform is today the main portal of open and public data on corruption in Colombia.

In numbers, it is estimated to have a cost-benefit ratio of 37.2, appreciating the quantifiable benefits, for every peso invested in the development of the platform, TpC received a $37 return.

Recently, an intelligent portal was launched to receive the financial statements of supervised companies in the country. This type of needs resulted in the creation of a business analytics alternative called Sophie, which was developed with the purpose of detecting companies at risk of bankruptcy in a premeditated way in order to think of viable and timely solutions. 

This tool has access to the financial and accounting information of corporations by processing more than 6 TB of information and will allow users to access corporate information online.

All these advances and figures demonstrate that GovTech' s profitability is positive. To provide better citizen services and continue on the path to development, governments must promote and adopt these types of instruments whose contributions are already tangible.