In terms of service in government offices, the Philippines is generally very traditional. That means a preference for cash payments instead of online payments, despite the available means to enter the 21st century. It often causes slow processing times and long queues. But one city government in the Philippines is trying to change that. The local government of Valenzuela City now lets citizens pay vehicle license fees, and business and real property taxes at city hall in new ways – through credit and ATM cards, and via mobile payments.
In a notice on the city’s website, Valenzuela City information officer Ahna Mejia says the system is part of a local program to simplify tax payments. So the card-based payments can now be paid through the point-of-sale (POS) machines that the Development Bank of the Philippines has installed in its taxpayer’s lounge. It also accepts payments from mobile payment platforms such as Smart Money, the e-wallet service run by telco Smart, and rival Globe Telecom’s G-Cash.
What does this mean?
By allowing online and electronic payments, it streamlines the process and lessens queues in government offices.
The Makati City government office makes for a good comparison. Since it still uses cash for its payroll of over 9,000 employees, it causes downtime for the entire office.
Clearly, a swipe of an ATM or credit card or a few clicks through an m-payment gateway can make things simpler. And safer for people. Plus, it can help lessen under-the-table charges on cash transactions – ie: bribery.
Challenges vs opportunities
The Philippines leads in mobile payments in Asia, and with the availability of the telco’s e-wallets, it’s something that citizens can take advantage of with ease.
But the banking penetration rate in the Philippines is at just 27 percent. And from this number, only three percent own a credit card. So are people ready for what Valenzuela City is rolling out to its citizens?
The Valenzuela City government also plans on expanding the system to include payments for business permits and license fees, public market and stall retail fees, and public terminal and parking fees. It also aims to use the m-payment service for its payroll system and payment of utility bills in the near future.
It is said to be the first time for a municipality to do this in the Philippines. Perhaps it will kickstart other local authorities to modernize. Once more cities offer this, the more efficient the country becomes. Also, who knows, it might help increase usage of online payment in the Philippines for e-commerce as well.
(Editing by Steven Millward)
(Photo: Valenzuela government Facebook page)