Purpose and Policy Declaration
- Promote efficient government service delivery, expedite transactions, boost revenue, and reduce graft/corruption.
- Enable digital payment adoption to ensure fast, secure, and transparent government service delivery.
- Facilitate effective disbursement of financial assistance.
- Promote an inclusive digital finance ecosystem accessible to vulnerable sectors.
- Develop ICT-capable human resources and bridge digital infrastructure gaps ensuring network security and neutrality.
Coverage
- Applies to all Executive Branch departments/agencies/instrumentalities, including SUCs and GOCCs, collectively "Covered Agencies".
- LGUs are guided by the same rules for their collections and disbursements.
- Philippine Embassies and Consulates also covered through DFA.
Definitions
- Key terms defined include Advise to Debit Account (ADA), Authorized Government Depository Bank (AGDB), Digital Collection, Digital Disbursement, Digital Payment, Electronic Fund Transfer (EFT), Electronic Money (E-money), Government Servicing Bank (GSB), Merchant Discount Rate, National Retail Payment System (NRPS), Payment Service Provider (PSP), Transaction Account.
Digital Payments for Government Disbursements
- All Covered Agencies must utilize safe, efficient digital disbursements for payments including salaries, financial aid, and purchases.
- Funds may be disbursed directly into recipients’ accounts whether in government or private institutions.
- Agencies must verify transaction accounts, ensure accuracy in payment instructions, establish public assistance mechanisms, and develop policies on account database accuracy.
- Top-up allowances to cover cash out fees may be added, subject to funding and limits.
- GSBs must execute payments timely, report successful or failed transactions, may charge fees subject to agreements, and notify service disruptions.
- Recipients have rights including account choice, correction of errors, and access to information.
- Agencies must include contingency plans for calamities allowing non-digital payments if necessary.
- Compliance with the Data Privacy Act is mandatory.
Digital Payments for Government Collections
- Covered Agencies must offer digital payment options alongside cash or traditional modes.
- Payment Service Providers (PSPs) procured must comply with the National Retail Payment System Framework and can be from government or private banks.
- PSPs must issue acknowledgments, process personal data per Data Privacy law, remit full collections promptly, provide government reporting facilities, and support issue resolution.
- Agencies must ensure invoice issuance, visible and accessible payment channels, promote digital payments, comply with electronic collection rules, and perform other prescribed functions.
Technical Working Group (TWG)
- Composed of DOF, DBM, BTr, BIR, and GPPB Technical Support Office representatives.
- Representatives designated at senior official level with alternates.
- Functions include developing procurement strategies, setting standards, monitoring compliance, guiding service agreements, resolving implementation issues, and public advocacy.
- Chaired by BTr with BTr serving as Secretariat, assisted as needed by BSP and others.
- Advisory body includes COA, DICT, DILG, and PPMI without voting rights.
- Meetings held quarterly with quorum requiring three of five members.
Transition Period
- Agencies must transition to digital disbursement within six months.
- Digital collections transition with tiering: within 1 year if partial digital already offered; up to 3 years if not yet offered.
- Each agency required to designate a digitalization team headed by a senior official.
- Transition plans must outline timelines, capacity development, staff training, and performance indicators, submitted within 60 days.
Funding
- Initial and subsequent implementation costs funded from existing appropriations or corporate funds following budgetary rules.
- Funds cover infrastructure, transaction fees, and other related expenses.
Digitalization Support
- DICT, DTI, and DILG assist in capacity building.
- Coordination with BSP, PPMI, industry, and development partners encouraged.
- DICT responsible for ensuring adequate internet connectivity.
Monitoring and Evaluation
- Agencies must submit bi-annual reports to TWG and COA tracking transition progress, KPIs, problems, and resolutions.
- DILG to consider compliance in awarding Seal of Good Local Governance to LGUs.
Final Provisions
- Separability clause ensures unaffected provisions remain valid if others are invalidated.
- Repeals inconsistent issuances.
- IRR takes effect upon publication in Official Gazette or general newspaper.
This comprehensive framework mandates the full digitalization of government disbursements and collections through a coordinated multi-agency effort to promote transparency, efficiency, financial inclusion, and secure financial transactions within the public sector.