The alternative payment provider Dwolla's recent partnership with the Iowa state government earns the company credibility while also opening the door to an area that needs to modernize the way it handles money.

The government "is the last bastion of where technology hasn't hit," says Michael Bousselot, policy advisor to Iowa Governor, Terry Branstad. "If we want to serve the people we have to turn to technology; innovation has to be a part of that solution."

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