By Bianca Cuaresma @BcuaresmaBM & Jovee Marie N. dela Cruz @joveemarie
BANGKO Sentral ng Pilipinas (BSP) Governor Benjamin E. Diokno and former House Speaker Alan Peter S. Cayetano believe the institutionalization of digital payments in government transactions would boost financial inclusion in the country.
“This is what we’ve been advocating for quite some time now; and definitely magiging mas inclusive at efficient ang government transactions dahil dito,” Cayetano was quoted in a statement issued last Tuesday.
Signed by President Rodrigo Duterte on May 12, Executive Order 170 (“Adoption of Digital Payments for Government Disbursements and Collections”) mandates all departments, agencies and instrumentalities of the government, including state universities and colleges and government-owned or -controlled corporations and enjoins local government units (LGUs) to utilize digital channels in the disbursement and collection of payments.
“Digital collection of payments will expedite transactions, generate savings for the government and the public and reduce the risk of graft and corruption,” Diokno was quoted in the statement issued by the central bank also last Tuesday.
Robust support
The EO also requires government entities to transfer funds directly into the recipient’s transaction account, whether held in a government or private financial institution. It also asks government agencies to offer digital options for the collection of taxes, fees, tolls and other government payables. The public, however, may still transact with the government through cash payment.
According to Diokno, EO 170 “provides robust support to BSP’s efforts in promoting payments digitalization and financial inclusion under the ‘Digital Payments Transformation Roadmap’ (DPTR) and the ‘National Strategy for Financial Inclusion.’”
The DPTR pursues BSP’s twin goals of converting at least 50 percent of all retail payments into digital form and onboarding at least 70 percent of Filipino adults to the formal financial system by 2023.
The NSFI, meanwhile, serves as the country’s blueprint to achieve the vision of driving financial inclusion toward broad-based growth and financial resilience.
Earlier this year, Diokno also said the wider adoption of digitalization, particularly of banks’ financial services, may help bring down the overall growth of consumer prices in the country.
Easier for Filipinos
Cayetano said he believes the EO will make it easier for people to access state assistance programs amid the lingering effects of the Covid-19 pandemic on the country’s economy as well as higher-than-average inflation.
“EO 170 is a step towards the right direction. This truly brings government into the 21st century,” he added.
According to the lawmaker, making disbursements available through digital payments will increase the efficiency of government aid programs, allowing Filipinos in need to receive financial assistance without having to queue for hours or deal with fixers or middlemen.
Cayetano said this is an “exciting” development because “there are so many possibilities.”
“Once the government gets digital payments going, [we can link this with the] National ID [system],” the lawmaker said. He added that if there is an application (app) that could be developed “para all-digital na yung paglalakad ng assistance, e di better.”
The order covers disbursements in the payment of goods and services, the distribution of financial assistance, as well as in the payment of salaries, wages, allowances and other compensation to employees.
Government collections such as taxes, fees, tolls and other charges are also covered by EO 170.
More apps
CAYETANO, who is set to be proclaimed as one of 12 new senators by the Commission on Elections on Wednesday, has suggested that departments should use mobile apps to make their disbursement processes more efficient.
“Dapat may app na rin yan, may DSWD [Department of Social Welfare and Development] app, may DOH [Department of Health] app, merong Transport Help app, na kapag kumpleto naman ang requirements mo, i-send mo lang and then through GCash or through a QR code sa phone mo e matatanggap mo na,” he said.
Cayetano said he believes one way to cut red tape and reduce corruption is to leverage technology by developing mobile apps that people can use to process government transactions and making it possible to receive financial aid through financial technology services.