LGUs Urged to Settle Their Payables Through Digital Payment Options
Banko Sentral ng Pilipinas (BSP) continues to enhance its digitization and financial inclusion effort and is now pushing Local Government Units (LGUs) to adopt the new method.
BSP Governor Benjamin Diokno stated that digital disbursement would build a more inclusive financial system, especially now that the country is adjusting to the pandemic.
Dioko expressed, “Financial inclusion enables unbanked Filipinos to access affordable financial products and services, such as opening transaction accounts, obtaining loans, and investing in and purchasing products safely and conveniently.”
Under the Digital Payments Transformation Roadmap (DPTR), BSP pledged to change at least half of the total retail payments to electronic transactions while pushing at least 70% of Filipino adults to create and utilize their transaction accounts by 2023.
The latest assessment shows that in terms of volume, the share of digital payments to the total retail transactions increased to 30% in 2021 from 20.1% in 2020. Meanwhile, Filipino adults with digital accounts rose to 53% in the first quarter of 2021 from the previous 29% in 2019.
Diokno cited, “Financial inclusion, therefore, empowers Filipinos to improve their welfare and overall quality of life.”
Earlier, the Department of the Interior and Local Government (DILG) released an advisory pushing LGUs to settle their payables for more structured government transactions and delivery of social services to citizens.
Last January 26, DILG Secretary Eduardo Año issued an advisory calling on DILG regional offices and LGUs to boost the digital disbursement system.
The released advisory pushed LGUs to use digital payment in disseminating local and national financial assistance programs to their recipient’s transaction accounts.
In addition, the advisory also aims to help unbanked citizens create and open an account in the Land Bank of the Philippines that is accessible in more than 300 Philippine Identification System (PhilSys) registration centers free of charge.
DILG stated that those with smartphones could utilize their accounts using the Landbank- Pay mobile wallet.
LGUs were also pushed to join PhilSys in advocating digital disbursement for a more streamlined and safer transfer of government assistance to their beneficiaries, as well as to coordinate with Landbank for the digital allocation of financial assistance through the transaction accounts opened by the bank for those qualified recipients.