Digital Transformation and Public Value in Sustainable Governance: The Role of Taiwan’s Smart City Mobile Payment Platform in Development, Digital Service, and Citizen Engagement

Abstract

This study explores the digital transformation and public value created through the target city’s smart city Mobile Payment APP and digital city token system within the context of sustainable governance in Taiwan. Adopting a convergent mixed-methods research design, this research integrates quantitative Importance–Performance Analysis (IPA) surveys of 632 users with qualitative in-depth semi-structured interviews involving eight key stakeholders (namely, government officials, system developers, affiliated merchants, and citizen representatives). This methodology assesses service quality, user satisfaction, and cross-sector collaboration effects. The findings reveal that the mobile payment platform significantly enhances digital service delivery; fosters user engagement; and supports sustainable urban development goals, particularly net-zero carbon emissions. However, the IPA results highlight critical service gaps in the “Priority Improvement Zone,” specifically regarding the insufficient number of affiliated merchants and inconvenient information search functions. Qualitative findings attribute these gaps to cross-departmental administrative barriers and security-focused design trade-offs. This study contributes empirical evidence on the integration of financial technology and public service innovation as a means to advance smart governance and sustainable urban ecosystems. The results provide actionable insights for policymakers, city planners, and service designers focused on promoting digital public services that facilitate economic vitality, environmental sustainability, and collaborative governance.

1. Introduction

Compared with rural areas, cities possess more convenient transportation networks, diverse employment opportunities, and rich cultural and educational resources, thereby attracting a massive concentration of population. According to reports released by the United Nations, the global urban population share has climbed from 30% in 1950 to 54% in 2014, and it is estimated that by 2050, a substantial 66% of the world’s population will reside in cities, while 41 megacities (with over 10 million persons) are projected to emerge by 2030 [1]. Following rapid urban development and massive population influx, issues such as traffic congestion, environmental pollution, and energy consumption have become increasingly severe. Addressing the rising urban population and providing higher-quality public services in fields like education, healthcare, transportation, energy, and employment has become a critical and urgent challenge faced by nations worldwide.

In this context, the smart city concept has emerged, grounded in Information and Communications Technology (ICT). By integrating technologies such as the Internet of Things (IOT), big data, and Cloud Computing, it assists managers in obtaining real-time and accurate information, thereby enhancing the efficiency of urban governance [2]. This approach attempts to demonstrate resilience [3], inclusion [4], and sustainability in the face of challenges such as population aging, low birth rates, climate change, and evolving social values [5].

The promotion of smart cities focuses on “creating universal value through AI” [6,7]. The core value driving this developmental thinking must be “citizen-centricity, industrial benefit, and governmental accountability.” The key lies in the integration of cross-domain services, where connecting heterogeneous data and systems from different fields is essential in forming complete and meaningful public services that balance public welfare, industrial momentum, and governance effectiveness. In other words, citizens must genuinely perceive the change and value, industries must find innovative momentum, and the government must shoulder its governance responsibilities. By linking values with people, the environment, and the living area, public services are no longer fragmented but become an integrated and perceptible experience.

The development of smart cities in Taiwan is primarily driven by a series of smart city and rural area programs [8]. The central and local governments collaborate to identify the authentic needs of the 22 counties and cities, allowing technology to seamlessly integrate into citizens’ daily lives. By treating the city as an integrated system with a digital nervous system, an intelligent response capability, and the ability to optimize various layers, technology gradually becomes an integral part of life, whether in transportation, healthcare, agriculture, or urban governance.

To date, Taiwan’s smart city and rural area programs have accumulated 158 demands for smart living and digital governance from local counties, attracted over 345 businesses, developed 258 smart services for local implementation, and facilitated 118 startups to return to their hometowns. These figures showcase the collaborative accumulation of industry, government, academia, and research sectors, ensuring that applications in transportation, healthcare, smart agriculture, and urban governance genuinely enter local domains. Through citizen feedback, the government and industry continuously attempt revisions, exploring viable models for service sustainability and further diffusion. Taiwan is progressively building its own smart service ecosystem through this process.

For instance, the target city investigated in this research, guided by the philosophy of “citizen needs,” addresses the challenges of the post-pandemic new normal by utilizing the latest technology and human kindness to promote digital economy transformation, financial technology innovation, and net-zero carbon emissions goals, thereby progressing toward sustainable smart city development and constructing a cross-regional, nationwide, integrated digital economy ecosystem.

In July 2022, the target city piloted a “Mobile Payment APP”—an integrated mobile smart payment tool. This platform, centered on digital economic development and the goal of promoting net-zero carbon emissions, issues bonus tokens through a municipal interaction incentive mechanism to accelerate digital payment transformation and create a zero-contact, low-carbon new economic model. It not only encourages active civic participation in municipal affairs but also leverages the platform’s exposure for affiliated merchants and the consumer-driving effect of bonus incentives to stimulate the economy. The city also hosts public welfare marketing events to support disadvantaged groups and promotes energy saving and carbon reduction in daily life to respond to global climate action, providing carbon footprint calculation and incentives to boost participation. This joint effort with citizens achieves a win–win result in public welfare, social benefit, and environmental sustainability.

The “Mobile Payment APP” system and its supporting measures have consecutively won the “2023 WITSA Smart City Award Grand Prize,” the regional and national champion of the “2023 IDC Future Enterprise Award,” the “2023 International Innovation Awards (IIA) for Innovative Service,” and the grand prize for the “ASOCIO 2024DXAward’s Smart City Award in Public Sector.” This demonstrates the target city’s proactive implementation of carbon reduction initiatives, strong emphasis on digital public services, and commitment to climate governance, striving to create a smart city economic ecosystem alongside its citizens and businesses.

Given this, it is necessary to conduct a pilot study on the “Mobile Payment APP”—which represents the target city’s proactive promotion of smart cities and the digital economy ecosystem and has garnered numerous international awards—by examining user satisfaction and feedback on the system. Furthermore, by employing Importance–Performance Analysis (IPA), this research aims to clarify the distribution of key attributes; identify service elements valued and satisfied by citizens, provide administrators with a clear benchmark for service quality inspection and improvement, and ultimately identify critical success factors to offer a valuable reference for implementing relevant systems to collectively advance the ideal of carbon reduction and environmental sustainability.

2. Literature Review

2.1. The Current Development Status of Smart Cities in Taiwan

With the flourishing development of ICT and the increasing popularity of digital technology applications, cities are compelled to leverage advances in information technology to address complex urban problems and pursue more intelligent approaches to planning and governance [9]. Since around 2005, the term “smart city” has been widely adopted, evolving into a technology-based paradigm for urban planning, development, and management. This paradigm emphasizes the construction of complex information systems that integrate urban architecture, transportation networks, and public facilities to maximize operational efficiency and minimize energy consumption [10,11].

At the same time, the smart city concept increasingly emphasizes sustainable development in harmony with the natural environment. Foundational technologies such as smart grids are applied to build low-carbon, high-efficiency next-generation cities [12]. This approach also places strong emphasis on investments in human and social capital through various communication facilities, aiming to promote sustainable economic development and improve quality of life [13]. As a result, social infrastructure has gradually expanded from a narrow focus on electricity and water resources to a broader scope covering transportation, logistics, and public services [12]. Through the integration of these infrastructures with ICT tools, citizens can benefit from improved urban economics, transportation, environmental sustainability, governance efficiency, and more effective resource utilization [13].

Subsequent scholarly discussions have further refined the definition of smart cities as “cities that optimize operations and services by integrating physical, digital, and social systems” [14]. Over time, this concept has extended beyond purely technological innovation to encompass broader social and environmental objectives, positioning smart cities as comprehensive, data-driven strategies to enhance urban sustainability and resident welfare [15]. From this perspective, smart cities are regarded as having substantial potential to address mounting urbanization challenges—including resource scarcity, environmental pollution, and social inequality—while the European Innovation Partnership on Smart Cities and Communities explicitly advocates economically, socially, and environmentally sustainable development through the combined use of technology, social innovation, and environmental protection instruments [16].

2.2. Analysis of Classic International Smart City Cases

The smart city concept has evolved from an initial technology-driven model into comprehensive urban development strategies emphasizing the synergistic integration of technology, society, and environment. Regions worldwide, including Taiwan, actively promote such initiatives. The following reviews three classic cases of particular significance:

(1)

Denmark: Copenhagen is recognized as one of the world’s most sustainable cities, pursuing the ambitious goal of becoming the first carbon-neutral capital. This relies on integrated smart technologies including smart grids that incorporate wind, solar, and other renewable energy sources to significantly reduce fossil fuel dependence [16]. City buildings feature intelligent energy management systems for real-time monitoring and usage adjustment. The intelligent transportation system utilizes IoT sensors and data analytics to optimize public transit routes and traffic signals, complemented by comprehensive bicycle networks and smart parking systems that reduce congestion and emissions. This success demonstrates close integration of technology with sustainability goals through robust policy support and broad citizen participation (City of Copenhagen, 2021), indicating that smart city construction requires comprehensive frameworks beyond technological innovation alone.

(2)

Spain: Barcelona, Spain’s second-largest city, deployed IoT sensors to monitor water usage and detect leaks in real time, enabling rapid repairs and reducing water waste by 25% since implementation [17]. AI technology further predicts water demand during drought seasons by analyzing historical data and weather forecasts, proactively adjusting allocation for supply stability [2]. These measures not only improve water efficiency but enhance climate resilience, positioning Barcelona as a global model for smart water resource management.

(3)

Taiwan: Since 1998, Taiwan has built digital government infrastructure, with local governments prioritizing smart cities by applying automation and intelligent technologies atop digital networks. Urban IoT and cloud computing centers integrate comprehensive resources across government, city, society, and enterprises—including geographical, infrastructural, social, economic, medical, educational, tourism, and human resources—for effective spatial allocation. This transitions from device-specific usage to seamless public integration, enabling anytime-anywhere personalized services via smart devices. Such governance promotes local economic development [18], enhances efficiency [19], increases civic participation [20], and secures top international digital governance rankings after over 20 years [21].

These cases illustrate technological achievements but reveal research gaps in digital payment platforms for citizen engagement and sustainable governance.

2.3. The Current Status of Digital Finance and Mobile Payment APP Promotion by Local Governments in Taiwan

Digital finance has emerged as a global trend amid widespread Internet penetration, with consumers increasingly adopting online financial operations. This encompasses financial business diversification driven by Internet, mobile communications, and social media technologies, enabling access to services unbound by operating hours or location [22]. In Taiwan, digital finance addresses critical challenges including aging populations, labor shortages, and accelerated adoption post-COVID-19 as citizens avoid physical contact [23].

Singapore provides a valuable benchmark through its “Smart Nation 2025” plan announced in 2014. Since 2018, Singapore has implemented foundational frameworks—“Digital Economy Framework,” “Digital Government Blueprint,” and “Digital Readiness Blueprint”—supported by four key measures: (1) smart nation sensor platforms, (2) national digital identity systems, (3) electronic payment promotion, and (4) open digital platforms [2]. To achieve a cashless society, Singapore phases out cash at public transport hubs while integrating mobile payments with autonomous vehicle services like Sentosa’s unmanned shuttle buses.

Responding to global trends, Taiwan established the “Financial Market Development and Innovation Department” on 1 January 2025, tasked with balancing safety and development through “Green and Transition Finance,” “Fintech and Innovation,” and “Financial Market Development” initiatives. This department actively promotes green finance to support Taiwan’s net-zero transition, aligning private capital with sustainable infrastructure and low-carbon technologies [24].

Against this backdrop, the target city piloted its “Mobile Payment APP” in July 2022. This integrated platform combines credit card binding with e-wallets for “Digital City Tokens” and coupons, accepted by over 5700 contracted merchants and four major convenience store chains. Beyond basic consumption, the APP enables online ticket purchases (commodities, light rail/MRT) to revitalize local commercial districts, promote characteristic tourism, accelerate digital payment transformation for citizens and merchants, and enhance citizen engagement through planned expansions including tax payments and municipal promotions.

2.4. Advantages and Promotional Achievements of the Target City’s Platform

The target city’s platform integrates municipal mobile services, provides commercial transaction capabilities, and delivers instant municipal information, presenting several key advantages:

(1)

Integration of municipal mobile services: Modern essentials have shifted from keys, wallets, and cash to mobile phones. Public sectors must proactively adapt by offering technology-friendly services that enhance the smart city environment. The “Mobile Payment APP” excels here, providing citizens with new options for daily shopping and consumption while establishing digital payment tools for government fees and business transactions. The public sector’s high credibility, objectivity, and non-profit nature rapidly builds trust, helping citizens and businesses adopt new transaction models.

(2)

Provision of commercial district transaction platform: Taiwan hosts 1.59 million SMEs (over 98% of enterprises), employing 9.2 million workers (80% of the national workforce) [17]. Despite strong product competitiveness, SMEs often lack unified technological platforms to connect limited resources and coordinate promotion efforts. The “Mobile Payment APP” addresses this by leveraging government resources to provide SMEs of all sizes with digital marketing platforms. Its functions facilitate consumer-SME interactions, simplify small-amount transactions, and boost efficiency through integrated digital tools, resolving resource constraints and aligning operations with future technological development to enhance commercial district resilience and sustainability.

(3)

Provision of instant municipal information: While local governments maintain various communication channels, they lack integrated single-window platforms for effective citizen engagement. The “Mobile Payment APP” uses digital bonuses as incentives, supporting both citizen-initiated information seeking and government policy push notifications. This dual approach strengthens policy publicity, synchronizes municipal rewards with communication, and enhances policy dissemination timeliness and overall government promotional effectiveness.

(4)

Promotional achievements: System data shows 48,745 registered members (average age ~40 years), with highest concentrations in the 41–50 and 31–40 age groups [22]. From July 2022 to February 2023, seven municipal departments’ marketing events drove substantial usage: NTD 1.8 million in Digital City Tokens, NTD 1.455 million in coupons, and 3717 ticket purchases, demonstrating strong traffic generation and consumer engagement. Internationally, the APP competed against entries from the UK, US, Brazil, Canada, Spain, Japan, China, and Singapore, winning the 2023 IIA “Service and Solution Category” prize, 2023 WITSA Smart City Grand Prize, 2023 IDC Asia-Pacific/Taiwan dual championship, and 2024 ASOCIO Smart City Public Sector Grand Prize. These awards recognize its carbon footprint tracking, decarbonization rewards, and alignment with global net-zero objectives.

2.5. Research Gap and the Context of Taiwan

Despite widespread smart city initiatives, a persistent gap exists between theoretical “Smart Utopia” visions and practical “Smart Reality” implementation [25]. Existing research predominantly examines technological infrastructures (sensors, IoT, big data platforms) while neglecting governance reforms, policy participation, and sustainable business models that deliver tangible public value [26].

Taiwan provides an ideal context to address this gap. Through central-local government collaboration, Taiwan has built robust ICT infrastructure and consistently ranks among top performers in international digital governance assessments [21]. Having progressed beyond basic digital construction, Taiwan now tests “next-generation” smart services that embed technology into daily life to tackle population aging, climate change, and net-zero goals [8,9].

This study bridges these gaps by examining Taiwan’s most populous city’s Mobile Payment APP as a strategic case. Unlike prior studies focused on infrastructure deployment, this research employs IPA and stakeholder interviews to provide empirical evidence on how fintech platforms enhance citizen engagement, digital service delivery, and sustainable governance—offering a replicable model for smart cities worldwide.

3. Related Work Materials and Methods

Given that the Mobile Payment APP involves multiple dimensions—including user experience, local economic revitalization, and macro-level sustainable governance—a single methodological approach is insufficient to capture its full scope. Therefore, referencing the recent methodological literature [27], this study adopts a convergent mixed methods research design.

The advantage of this design lies in its ability to simultaneously collect large-scale quantitative data (via questionnaires) to establish the breadth of user experience and identify service gaps (using IPA), while employing qualitative in-depth interviews to acquire deep insights from key stakeholders, including business district merchants, municipal execution units, APP developers, and users. By interpreting and integrating the findings from both data sets, this study aims to provide comprehensive, evidence-based recommendations that balance user needs with policy feasibility

3.1. Survey Questionnaire and Statistical Analysis

This study references the third stage, “Evaluation”, in the user experience design development process [28]. We collected user perceptions of the “Mobile Payment APP” and evaluated the results and feelings regarding its usage. The evaluation scope focuses on the user’s actual experience and assesses the APP’s design. Based on the literature, the evaluation indicators included aspects of APP functionality and quality, with 26 preliminary items designed.

After a pilot test and discussions with experts and relevant city government personnel, the questionnaire draft was adjusted. The 26 items related to the user’s actual usage experience were revised to 17 items. Each item asked respondents about their perceived level of importance and satisfaction, totaling 34 questions. Overall, the user questionnaire design consists of four parts:

• Part I: User’s APP usage experience.
• Part II: User’s perceived importance of the “Mobile Payment APP” functions.
• Part III: User’s satisfaction level regarding the use of the “Mobile Payment APP” functions.
• Part IV: Respondent’s basic information, including gender, age group, residence, and occupation.

Subsequently, the IPA method is utilized to identify the gap in user perception, thereby developing subsequent improvement recommendations.

(1)

Survey target: The survey targets are general citizens. Respondents were asked to complete the usage experience and user interface satisfaction questionnaire. The questionnaire distribution methods included dispensing during related promotional events and utilizing the existing questionnaire platform within the “Mobile Payment APP”.

(2)

Data analysis: After the questionnaires are collected, relevant statistical analyses are conducted to understand the respondents’ perspectives. The following statistical analysis methods are adopted: descriptive statistics, reliability and validity analysis, t-test, and IPA.

The IPA method is a technique for prioritizing attributes related to a specific service or product through two major constructs: “importance” and “performance”. “Importance” refers to the significance of the attribute to the consumer, while “performance” is the consumer’s perceived measure of how well the attribute is executed. The analysis of importance is beneficial for resource allocation, deployment, or strategic prioritization decisions. The analysis of performance, conversely, is a reference for improving the quality of the product or service. It is used by consumers to assess their preference for product attributes based on their satisfaction from initial expectation to actual experience, and it can also evaluate the importance of providing these service quality attributes.

IPA is considered a valuable analytical method, as it prioritizes the use of limited resources. It uses a two-dimensional matrix to delineate quadrants that highlight which areas are more or less important, serving as a reference for strategic recommendations [20]. The main concept involves plotting the average scores of importance and performance levels onto a two-dimensional matrix. By using the matrix to distinguish the relative positions of different average attribute scores, it facilitates the provision of practical recommendations and strategic applications for specific quality attributes [29,30,31].

In the IPA coordinate chart (Figure 1), the X-axis symbolizes “importance”, and the Y-axis symbolizes “performance”. The plotting is based on the combined assessment results of both importance and performance. Utilizing the overall mean of both importance (I) and performance (P) as the dividing points provides stronger judgmental power than using the scale’s middle point. Therefore, the overall mean value from the questionnaire survey can be used as the dividing point for the X- and Y-axes. The consumer ratings for the importance and satisfaction levels of each attribute are then displayed in an easily understandable two-dimensional coordinate chart [32,33,34].

3.2. Questionnaire Design and Scale Development

This study references the user experience design process proposed by [28], focusing on the third stage, “evaluation,” to understand public sentiment and design feedback regarding the “Mobile Payment APP.”

Based on Umair’s evaluation items and users’ actual operational experience, a preliminary draft of 26 items covering APP functionality and quality was developed. To ensure expert validity, a panel consisting of experts from the municipal government, the APP development company, merchant associations, and academia (see

Table 1. Expert validity review panel.

Family Name	Job Title	Organization
Chen	Director	The Target City Government
Niu	Section Member	The Target City Government
Chen	CEO	Mobile Payment APP Development Company
Yu	Sales Specialist	Mobile Payment APP Development Company
Lin	Chairman	The Target City Commercial District Federation
Wang	Chairman	Pingxi Charm Commercial District
Lin	Professor	Dean, College of Information, University of Science and Technology

) was convened to review and pre-test the questionnaire.

Following the expert review, the questionnaire was refined to 17 items. For each item, respondents were asked to rate both their perceived “importance” and “satisfaction,” resulting in a total of 34 questions. The questionnaire structure comprises four parts: (1) user APP operation experience, (2) perceived importance of APP functions, (3) satisfaction with APP functions, and (4) demographic background (gender, age, residence, and occupation).

3.3. In-Depth Practical Interviews

To complement the broad user opinions gathered through the quantitative survey, this study employed qualitative in-depth interviews to capture the perspectives of key stakeholders. This approach was designed to gain insights into the practical aspects of policy formulation, system development, and sustainable implementation.

A semi-structured interview method was utilized, employing a pre-determined outline to ensure systematic questioning while maintaining the flexibility to pursue deeper discussions and follow-up inquiries. We invited subjects with representative roles and relevant experience to ensure the validity of the qualitative data. The participants included the following:

Two personnel from the target city’s municipal government (policy side).

Two representatives from the Mobile Payment APP development company (technical side).

Two representatives from affiliated commercial district merchants (business side).

Two citizen representatives (user side).

Data collection involved full audio recording and simultaneous note-taking. All recordings were transcribed verbatim to extract key content and core thinking. This qualitative analysis aims to reinforce the quantitative data by exploring core factors that numbers cannot fully reveal—such as challenges in policy, design, or practical execution—thereby facilitating more concrete and comprehensive conclusions.

The specific objectives of the interviews were tailored to the stakeholder groups:

Affiliated merchants: The interviews focused on (1) problems encountered during APP operation or the verification process; (2) the perceived benefits and suggestions regarding the digital city tokens or coupons.

Government officials and developers: The interviews focused on (1) the target city’s smart city policy direction, including the rationale, actual implementation, and expected benefits of promoting the “Mobile Payment APP”; (2) the initial design concepts and expected outcomes from the development perspective.

These qualitative insights were subsequently cross-referenced with the user experience survey results to identify potential service gaps and areas for improvement.

3.4. Data Collection and Sample Profile

To gather empirical data on user experience, a digital survey questionnaire was embedded within the “Municipal Awards—Questionnaire” section of the case Mobile Payment APP. The data collection period spanned 1 April to 30 June 2025, yielding a total of 632 valid responses.

Regarding the demographic profile of the respondents, the gender distribution was balanced, with males and females each accounting for approximately 50% of the sample. Regarding the age structure, the largest cohort was the 31–40 age group (37.4%), followed by the 41–50 age group (20.5%). Geographically, the majority of respondents resided in the target city (52.0%). Occupational analysis indicated that “other emerging industries and freelancers” constituted the largest segment (33.5%), followed by the service industry (24.3%).

To ensure the rigor of the research instrument, reliability and validity analyses were conducted. The Cronbach’s α coefficients for the three main constructs—usage experience, importance evaluation, and satisfaction evaluation—were 0.91, 0.98, and 0.94, respectively. All values exceeded the recommended threshold of 0.5, indicating satisfactory internal consistency. Furthermore, the Composite Reliability (CR) values ranged from 0.734 to 0.936, and the Average Variance Extracted (AVE) values ranged from 0.561 to 0.786. These figures meet the criteria established in previous studies [35,36], confirming that the latent variables in this study exhibit robust construct reliability and convergent validity.

4. Data Analysis and Results

4.1. Analysis of User Experience and Preferences for the “Mobile Payment APP”

According to the responses from participants with prior usage experience, the results indicate that the majority of users engage with the “Mobile Payment APP” infrequently. The data reveals that the largest proportion of respondents reported “rarely use” (approximately 43.2%), followed by those who use it “at least once a month” (approximately 25.1%), and “used only once after downloading” (approximately 23.7%).

Figure 2 clearly demonstrates a generally low usage frequency among most users. This trend is likely due to the limited issuance and circulation of digital city tokens or coupons, which serve as the primary incentive for engagement. However, as additional functional utilities—such as credit card binding—are progressively introduced, it remains to be seen whether user willingness and retention will increase in the future.

4.2. Analysis of Function Usage Patterns and Perceived Utility

Figure 3 presents the distribution of the most frequently used functions within the APP among respondents with prior usage experience. The data reveals a highly concentrated usage pattern dominated by three key functions.

Figure 3 shows that the most utilized function is “Municipal Awards (Prize Claim),” accounting for 30.4% of the usage. This indicates that nearly one-third of user activity is aimed at claiming government-issued rewards or tokens. Closely following is “City Token Transfer” at 27.3%, highlighting frequent interaction and token circulation among users. The core “Payment Function” ranks third, accounting for 22.5% of total usage. Other features, such as “Transaction Record” (12.8%) and “Merchant Discount Lookup” (2.6%), exhibit significantly lower usage rates, showing a long-tail distribution.

These findings have profound implications for understanding user motivation. The dominance of “Municipal Awards” strongly suggests that current user engagement is primarily driven by extrinsic motivation—specifically, the desire to acquire free value—rather than an intrinsic need for the payment utility itself. Furthermore, the high ranking of “City Token Transfer” underscores the social potential of the token economy, implying that tokens are actively circulated for social interaction or account consolidation. Conversely, the fact that the core “Payment Function” ranks only third indicates a relative marginalization of the platform’s primary purpose. This evidence suggests that the APP currently functions more as a “municipal reward collection platform” than an essential daily “payment tool,” validating the need for strategies to transition users from reward-seeking behavior to active transaction capability.

An analysis of the functions that respondents considered the most useful shows that municipal rewards ranked the highest (about 31.8%), followed by digital city token transfers (about 29.6%), and payments (about 19.2%). The results are presented below in Figure 4.

These findings suggest that the respondents primarily obtain information about earning bonus tokens or coupons through municipal reward activities, which motivates them to engage in consumption or token transfer behaviors.

Finally, regarding respondents’ suggestions for features that could increase app usage, the most popular recommendation (about 55.6%) was to offer bonus tokens through check-ins, missions, or mini-games (Figure 5). This indicates that users hope the app will frequently launch promotional activities—even small token rewards can effectively motivate users to engage with the app.

In addition, regarding the functions that respondents considered least user-friendly in the Mobile Payment App, the payment function ranked highest (about 16.7%) (Figure 6). Further user interviews revealed that the main reason was that users were required to enter a password for every transaction, and the app did not support alternative authentication methods such as fingerprint recognition.

The second most frequently cited issue was the search function for partner stores offering discounts (about 16.5%). Respondents mentioned that it was difficult to use due to scattered information, lack of keywords, and absence of location-based or categorical filtering. The third most common issue was the transaction record tracking function (about 14.9%), primarily because users found it difficult to locate the correct navigation path.

4.3. Importance and Satisfaction Analysis of Mobile Payment APP

Based on the respondents’ usage experience with the Mobile Payment APP, a paired comparison was conducted between the importance and post-use satisfaction of the APP usage functions. The results showed that attributes concerning the following all exhibited significant differences between importance and satisfaction (Figure 7): preferential merchant information, invoice section, digital city token or coupon collection activities, the number of affiliated merchants for digital city tokens or coupons, proactive notification of promotional event information, preferential merchant information search, payment function, credit card binding operation, convenience of switching between different functions, operational speed of functions, problem reporting function, and usability of functions. The average scores indicated that for all these items, importance exceeded satisfaction, revealing a user experience gap in the Mobile Payment APP. The largest gaps were, in descending order, the number of affiliated merchants for digital city tokens or coupons, preferential merchant information search, proactive notification of promotional event information, and preferential merchant information. This indicates that users highly value the quantity and information regarding preferential merchants but feel insufficiently satisfied. This dissatisfaction might stem from an inadequate number or variety of preferential merchants or inconvenient provision/searching of preferential merchant information.

A comparative analysis of the perceived importance and post-use satisfaction for each of the 17 functions within the Mobile Payment APP was conducted based on respondents’ usage experience. The results are presented below (

Table 2. Comparison of the importance and satisfaction of different functions.

Items		Total
		Importance	Satisfaction	Gap
1	Information Searching	3.42	3.47	0.05
2	Function Categorization	3.53	3.53	0.00
3	Transaction Record Inquiry	3.63	3.60	−0.03
4	Municipal Reward Info	3.64	3.61	−0.03
5	Discount Merchant Info	3.67	3.58	−0.09
6	Invoice/Receipt Area	3.61	3.57	−0.04
7	Token/Coupon Collection Activity	3.73	3.65	−0.08
8	No. of Partner Merchants	3.72	3.59	−0.13
9	Proactive Notification of Offers	3.72	3.61	−0.11
10	Token Transfer Feature	3.71	3.68	−0.03
11	Discount Merchant Info Inquiry	3.73	3.62	−0.11
12	Payment Functionality	3.71	3.63	−0.08
13	Credit Card Binding	3.69	3.62	−0.07
14	Ease of Function Switching	3.69	3.61	−0.08
15	Function Operation Speed	3.72	3.64	−0.08
16	Problem Reporting Feature	3.69	3.62	−0.07
17	Overall Function Usability	3.72	3.62	−0.10
Overall Average		3.67	3.60

):

• Overall gaps: The analysis revealed noticeable gaps between importance and satisfaction for attributes including preferential merchant information, invoice section, digital city token or coupon collection activities, the number of affiliated merchants for digital city tokens or coupons, proactive notification of promotional event information, preferential merchant information search, payment function, credit card binding operation, convenience of switching between different functions, operational speed of functions, and problem reporting function. In all these cases, the average scores indicate that importance exceeded satisfaction, highlighting a perceived usage gap for these functions among respondents.
• Largest discrepancies: Following the above, the largest discrepancies, in descending order, were found in the number of affiliated merchants for digital city tokens or coupons, preferential merchant information search, proactive notification of promotional event information, and preferential merchant information. This suggests that users highly value the quantity and information regarding preferential merchants but feel insufficiently satisfied, possibly due to an inadequate number or variety of merchants, or inconvenient provision/searching of merchant information.
• Highest rated items:

  ○

  The top two highest-rated attributes for importance were “Digital City Token” and “Coupon Collection Activities” (noted twice in the source, implying high importance for this category).

  ○

  The top three highest-rated attributes for satisfaction were “Digital City Token Transfer Function,” “Operational Speed of Functions,” and “Payment Function.”

Based on the IPA methodology, the mean scores of importance and satisfaction for all 17 survey items, as reflected by all participants, are plotted onto a coordinate plane. The X-axis represents importance, and the Y-axis represents satisfaction. Each axis uses the overall mean of its 17 items as the dividing line, thereby partitioning the coordinate plane into four quadrants. The results are shown in the figure below, with the items falling into the respective quadrants as follows (Figure 8):

• Quadrant I (Keep Up the Good Work): A total of 10 items, specifically, New Taipei Token or Coupon Collection Activities, Proactive Notification of Discount Activities, New Taipei Token Transfer Feature, Discount Merchant Information Inquiry, Payment Functionality, Credit Card Binding Operation, Ease of Switching Between Different Functions, Function Operation Speed, Problem Reporting Feature, and Usability of Functions.
• Quadrant II (Possible Overkill): A total of two items, specifically, Transaction Record Inquiry and Municipal Reward/Claim Information.
• Quadrant III (Low Priority): A total of three items, specifically, Information Searching, Function Categorization, and Invoice/Receipt Area.
• Quadrant IV (Concentrate Here): A total of two items, specifically, Discount Merchant Information, and Number of Partner Merchants for New Taipei Token or Coupons.

4.4. Qualitative Interview Findings

To complement the quantitative survey results, this study analyzed insights from in-depth interviews with government officials, APP developers, merchants, and users. The qualitative data reveals three key viewpoints of the mobile payment APP’s impact, as discussed below.

4.4.1. Mechanism for Driving Net-Zero and Sustainable Goals

Interviews with municipal policymakers confirmed that the APP was designed not merely as a payment tool but as a practical mechanism to operationalize the global net-zero agenda and SDG Goal 13.

[Gov. Official A] stated, “Our strategy was to integrate green concepts directly into mobile payments. By using bonus tokens to reward low-carbon actions, we transform abstract sustainability goals into tangible daily behaviors for citizens.”

[Gov. Official B] stressed, “Our APP has partnered with smart recycling machine operators, installing 48 units across the city to encourage the recycling of plastic bottles and used batteries. For every five items deposited, users receive the regular rewards plus an additional five city tokens as a limited-time bonus, further motivating participation in environmental protection. Through the user-friendly interface of the APP, residents can easily locate recycling machines via the channel map. This initiative integrates recycling into daily life, increases public engagement, strengthens environmental awareness, and expands the benefits of resource circulation. By reducing waste pollution, we move closer to our vision of sustainability and carbon reduction.”

The findings validate that the platform successfully functions as an incentive-driven governance tool for environmental sustainability.

4.4.2. Bridging the Gap in Digital Public Services

Government officials highlighted that the platform effectively addresses the fragmentation of digital services by creating a centralized interface for government–citizen communication.

[Developer B] explained, “Previously, municipal information was scattered. This APP bridges the gap by acting as a unified portal where digital city tokens serve as the crucial incentive (‘hook’) to encourage citizens to actively participate in municipal promotions and consume locally.”

This qualitative evidence supports the platform’s role in enhancing civic engagement through integrated digital services.

4.4.3. Supporting SME Digital Resilience

Interviews with affiliated merchants revealed the platform’s essential role in supporting SMEs that lack resources for independent digital transformation.

[Merchant Representative A] noted, “For many small vendors, building a digital marketing system is too costly. The government’s trusted transaction platform helps us overcome these limitations, allowing us to engage in digital marketing and enhancing the overall economic vitality of our business district.”

[Merchant Representative B] stated: “We have observed that citizens, by using mobile payment and participating in municipal activities, can earn city tokens and redeem them at partner merchants such as Carbon Reduction Environmental Activities. This design not only encourages public participation but also effectively boosts foot traffic and consumer spending in our district. Most importantly, it integrates the concept of sustainability and carbon reduction, allowing local economic vitality and environmental goals to advance hand in hand.”

We can confirm that the APP aids SMEs in overcoming traditional, fragmented business models, thereby strengthening local economic resilience.

5. Discussion

This study bridges theoretical smart city concepts and practical governance by analyzing the target city’s “Mobile Payment APP” through integrated IPA results and stakeholder interviews. The following subsections elucidate key substantive implications.

5.1. Integrating Sustainability into Smart Governance

Information and Communication Technology (ICT) facilitates greater citizen engagement in municipal policy [30]. As Taiwan’s most populous city facing urgent climate challenges, the target city declared a “climate emergency” in 2020, committing to 30% carbon reduction by 2030 and net-zero by 2050. The “Mobile Payment APP” transforms this commitment into action by integrating sustainability with digital payments through carbon footprint tracking and token rewards. This approach aligns with smart government frameworks that prioritize public service sustainability [37], effectively converting abstract environmental goals into concrete citizen behaviors.

5.2. Bridging the Gap Between Smart Utopia and Reality

Prior research highlights the “Smart Utopia” versus “Smart Reality” disconnect, where cities emphasize technological hardware over governance reform [38]. The target city counters this through “active engagement” via the APP, which delivers real-time municipal updates and digital token incentives. This shifts governance from passive administration to interactive participation, validating comprehensive smart governance models that evolve from information reception to citizen co-creation [35].

5.3. Breaking Silos Through Digital Infrastructure

India’s NPCI case illustrates that digital infrastructure fails without cross-departmental integration [39]. The target city previously faced fragmented communication across bureaus, lacking unified platforms for targeted citizen outreach. The “Mobile Payment APP” resolves this as a centralized digital window, consolidating information flow and reward mechanisms. This unified approach optimizes administrative resources and fosters Web 2.0-style interactive governance.

5.4. Fostering Digital Resilience in Local Commerce

Taiwan’s SMEs, comprising 98% of enterprises, face digital resource constraints despite economic significance. The government-backed “Mobile Payment APP” provides a trusted transaction platform, lowering digital marketing barriers and enabling unified promotional strategies. This enhances SME digital resilience, transforming fragmented commercial districts into integrated ecosystems and providing empirical validation of smart governance’s economic impact [40].

5.5. Addressing Service Gaps and User Experience

IPA reveals operational gaps despite strategic success. Overall satisfaction (M = 3.60) trails importance (M = 3.67), indicating targeted improvements needed.

The payment security paradox ranks highest among user complaints (16.7%), with mandatory passwords perceived as inconvenient. However, this reflects deliberate security prioritization amid Asia’s rising digital fraud, resonating with studies emphasizing trust as foundational to digital government platforms [41,42].

Merchant search (16.5%) and transaction tracking (14.9%) deficiencies highlight UI/UX shortcomings. Citizens expect intuitive, simple digital services [43]. Recommendations include enhanced visual design (font, color schemes, animations) and logical UX flows to improve discoverability and satisfaction.

6. Conclusions and Recommendations

6.1. Conclusions

This study utilized a mixed-methods approach to evaluate the effectiveness of the target city’s Mobile Payment APP and digital city token system. The findings confirm that the platform successfully functions as a comprehensive tool for digital transformation and sustainable governance. By integrating financial technology with carbon reduction incentives, the APP has created a novel model for civic engagement and local economic revitalization. However, the IPA results identified critical service gaps in the “scalability of the merchant ecosystem” and “information searchability,” which currently hinder broader adoption.

6.2. Recommendations for Policy and Practice in Taiwan

Building on the empirical findings, this section outlines actionable recommendations for the target city and other local governments in Taiwan. These proposals directly address Taiwan’s structural development challenges—including demographic aging, the predominance of Small and Medium-sized Enterprises (SMEs), and the national transition toward net-zero governance—by offering context-specific strategies for sustainable urban transformation.

• Integrate Mobile Payments with Long-Term Care Services—Taiwan’s rapidly aging population and declining birth rate demand innovative policy responses to mitigate social and healthcare burdens. Local governments should integrate municipal payment applications into long-term care systems, enabling seamless payments for elderly services, health insurance, and medical appointments. This enhances platform adoption, user retention, and alignment with “aging in place” policy objectives, fostering inclusive digital welfare ecosystems.
• Enhance SME Digital Transformation through Targeted Incentives—SMEs account for over 80% of Taiwan’s workforce but face resource constraints in digital adoption. Governments should link subsidies and training programs to mobile payment ecosystems like “City Token,” reducing entry barriers for businesses. This bolsters local competitiveness, revitalizes commercial districts, and expands merchant networks for sustainable smart city growth.
• Institutionalize Carbon Footprint Incentives for Net-Zero Goals—Taiwan’s net-zero ambitions require bridging policy with citizen action through practical tools. City apps should embed real-time carbon tracking and Digital City Token rewards, allowing users to monitor emissions from consumption, transport, and energy use. This creates a positive feedback loop, promoting low-carbon behaviors and enhancing policy implementation effectiveness.
• Foster Participatory Governance through Interactive Mechanisms—Shallow civic engagement hinders responsive governance in digital platforms. Implement real-time feedback dashboards for visible citizen input; organize hackathons and workshops for policy co-creation with businesses and academia, prioritized via voting; and integrate Taiwan’s MyData model for privacy-protected data authorization in analysis. These steps build transparency, trust, and collaborative decision-making.
• Establish Cross-Departmental Coordination to Overcome Administrative Barriers—Platform expansion in Taiwan is frequently hindered by administrative silos across different bureaus. Establishing a formal cross-departmental coordination mechanism is imperative. A dedicated task force should be empowered to integrate resources across transportation, environmental protection, and economic development departments. This ensures that the mobile payment ecosystem is supported by a unified administrative framework, reducing friction and maximizing operational efficiency.

6.3. Limitations and Future Research

This study has several limitations that suggest directions for future research:

• Sample bias: The survey employed convenience sampling within the APP, meaning respondents were already users of the platform. Consequently, the views of “non-users” or those who refused to adopt the technology are underrepresented. Future research should target non-users to understand barriers to adoption (e.g., digital divide).
• Single case limitation: The study focuses on a single municipality in Taiwan. While representative of high-density Asian cities, the findings may not be fully generalizable to rural areas or cities with different digital infrastructures. Comparative studies across multiple regions would validate these findings.
• Cross-sectional design: The data represents a snapshot in time. As the APP evolves and policies change, user satisfaction may shift. Longitudinal studies are recommended to track the long-term impact of digital tokens on citizen behavior change and actual carbon emission reductions.