‘As the country reopens its economy with the waning threat of the pandemic, President Duterte apparently recognized the need to give a harder push in the nation’s desire to be digitally engaged.’
IN 2020, Bangko Sentral ng Pilipinas (BSP) Gov. Benjamin Diokno reported that a fifth of all financial transactions made in the Philippines were through digital channels.
The BSP reported that 20.1 percent of monthly payment volume was done digitally by the end of 2020, an improvement over the level for the first semester of the year of 17 percent. The value of digital payments also grew from 25 percent to 26.8 percent during the same period.
Diokno noted then that while the COVID-19 pandemic may have disrupted the Filipino way of life, it also created exceptional opportunities to boost digital payments and financial inclusion in the country. This is true, because mobility restrictions during the height of the pandemic have become a strong reason for locked-down residents to use digital payments, along with home delivery systems and an aversion to the use of cash, fearful that paper money might carry the dreaded coronavirus 2019.
Since the Diokno report, Filipinos have become more accustomed to using digital payments for their financial transactions, as there was a sustained rise in the volume and value of merchant payments and remittances.
As the country reopens its economy with the waning threat of the pandemic, President Duterte apparently recognized the need to give a harder push in the nation’s desire to be digitally engaged. He ordered this week the adoption of digital payments for government disbursements and collections to “promote efficient delivery of services, expedite transactions, boost revenue and reduce the risk of graft and corruption.”
Under Executive Order 170, all departments, agencies, and instrumentalities of the government, including state universities and colleges and government-owned or controlled corporations, should adopt digital payments for their disbursements and collections. Local government units are likewise enjoined to do the same.
In his order, the Chief Executive said all agencies should use “safe and efficient” digital disbursement in the payment of goods, services, and other disbursements, including the distribution of financial assistance, payment of salaries, wages, allowances, and other compensation to employees.
Agencies are likewise directed to offer a digital mode of collecting payments for taxes, fees, tolls, and other charges and impositions.
This new executive policy will necessitate the engagement of services of established and respectable payment service providers and the new digital banks by many government agencies, further boosting economic activities. Nearing the end of his term, Duterte is sending a signal to the next administration about the benefits to the nation of an expansive digital economy.
