The directive of Secretary Carlos Dominguez III for the Department of Finance (DOF), its attached agencies, and government financial institutions (GFIs) to vigorously pursue their respective digital transformation programs long before the pandemic helped boost revenue collections, improved the delivery of services to the public, and set the stage for modern governance in the country.

Dominguez’s pre-pandemic instructions yielded the biggest positive impact on the Bureaus of Internal Revenue (BIR) and of Customs (BOC).

Preliminary data show that for 2021, the BIR was able to collect P2.07 trillion, which is only short by 0.31 percent of its target set by the Development Budget Coordination Committee (DBCC) for the year.

The BOC, meanwhile, overshot its target, collecting P645.77 billion, which was 4.7 percent over its DBCC-set goal of P616.75 billion for 2021.

The BIR’s ongoing digital transformation program, which has expanded the range of electronic payment channels that allow taxpayers to file and pay their taxes online, enabled it to continue collecting taxes even amid the mobility restrictions resulting from the pandemic.

Its digitalization initiatives include the Internal Revenue Integrated System (IRIS), which serves as the BIR’s central tool and repository to process taxpayer information; and the Enhanced Internal Revenue Stamps Integrated System (IRSIS), which is an application that manages the ordering, production, distribution, affixing and tracking of revenue stamps to monitor the proper payment of excise taxes on tobacco products.

Among other digitalization initiatives, the BIR also launched its Taxpayer Identification Number (TIN) mobile application, and has a single hotline number and Chatbot “REVIE” on its website to assist taxpayers with general inquiries, on top of being able to email the bureau regarding their concerns.

It has also put in place its Electronic Filing and Payment System (eFPS), Electronic Fund Transfer Instructions System (eFTIS), and other e-payment channels to allow taxpayers to pay taxes online.

With the shift to contactless transactions, almost 100 percent of annual income tax returns were filed online in 2021, the BIR said.

The BOC, meanwhile, is proceeding in full swing with its World Bank-funded Customs Modernization Program, as it implements its digitalization programs already in place, such as its Electronic Advance Ruling System (e-ARS) for Valuation and Rules of Origin; and the use of the Association of Southeast Asian Nations ASEAN Single Window (ASW) platform in exchanging customs declaration documents with other ASEAN-participating economies.

It also launched its Customer Care Portal System (CCPS), which enables stakeholders to electronically lodge and track the status of their inquiries, requests, and concerns; and Electronic Tracking of Containerized Cargo System (e-TRACC) that allows for the real-time monitoring of inland movements of containerized cargo using a GPS-enabled tracking device to secure the transport of shipments to their intended destinations are already in place.

In the DOF, its digitalization initiatives, among others, are the enhancement of its Tax Exemption System (TES); the GOCCs (Government-Owned and -Controlled Corporations) Liabilities and Monitoring System (GLaMS), which is an enhanced web-based system for the reporting and processing of data pertaining to the debts and liabilities of state-run firms; and the improvement of the Asset Register Information System (ARIS) to include the upcoming integration of additional information for legal cases tied to specific assets, and verification documents to check the accuracy of the asset details in the registry.

As for beneficiaries, among those who gained the most from digitalization were pensioners, employers and members of the Social Security System (SSS), which shifted online the filing of claims for retirement benefits, unemployment insurance benefit, sickness benefit, sickness benefit reimbursement for employers, maternity benefits (for self-employed/voluntary/OFW members/members separated from employment), maternity benefit reimbursement for employers, and funeral benefits (for member-claimants), as well as the filling of employees’ sickness and maternity notifications by employers.

Salary and calamity loan applications and the renewal of pension loans are also done online with the SSS, in line with the digitalization directives of Dominguez, who chairs the Social Security Commission (SSC).

Benefit claims are now released to the designated disbursement account of the SSS member or pensioner, whether it be through PESONet participants such as bank, electronic wallet, cash payment outlet, the Union Bank of the Philippines (UnionBank) UMID-ATM card or QuickCard. On the other hand, loan proceeds are released to the member’s bank account with a PESONet participating bank or UnionBank UMID-ATM or Quick Card.

Small investors have also benefited from the Bureau of the Treasury (BTr)’s move to allow the purchase of government securities through the BTr Online Ordering Platform for the Land Bank of the Philippines (LandBank), the Development Bank of the Philippines (DBP), First Metro Securities Brokerage Corp. (FMSBC) and China Banking Corp. (ChinaBank) account holders; the Bonds.Ph mobile app; and the Overseas Filipino Bank (OFBank) app. BTr’s own mobile app (BTr App) was likewise launched to provide comprehensive information about the National Government’s retail offerings and seamless link to online ordering channels.

The BTr’s other digitalization initiatives include the National Government Collection and Disbursement System (NGCDS) that now allows Authorized Government Depository Banks (AGDBs) to upload online daily and monthly collection reports to its electronic database; the Client Relationship Management (CRM) System for the National Registry of Scripless Securities (NRoSS), which serves as a portal where NRoSS participants can raise a ticket to report issues, concerns and queries related to the NRoSS System; and the Online Fidelity Bonding System (OFBS) that facilitates the electronic submission and processing of fidelity bonding requirements, and e-payments through the LinkBiz portal of the LandBank.

To simplify the monitoring and recording of the non-financial assets of the National Government (NG), the BTr has set up the National Asset Registry System (NARS), which maintains a comprehensive list of all strategically important assets such as land, buildings, roads, bridges, irrigation systems, and dams, among its other digitalization programs.

For business enterprises, the Securities and Exchange Commission (SEC) also sped up its digital reforms that include the Electronic Simplified Processing of Application for Registration of Company (eSPARC), which has so far processed over 26,000 applications of business registrations online in just one day in as fast as less than 2 minutes.

The SEC also implemented its Electronic System for Payments to SEC (eSPAYSEC) to facilitate the payment of registration charges, penalties, and other transaction fees with the SEC online using debit and credit cards, digital wallets, and other cashless payment options; and the Electronic Filing and Submission System (eFAST) that allows companies to submit the Audited Financial Statement (AFS), General Information Sheet (GIS), Sworn Statement for Foundations (SSF), General Form for Financial Statements (GFFS), Special Form for Financial Statement (SFFS) and other reportorial requirements.

For its part, the Insurance Commission (IC), has a web-based application—the Electronic Application and Certification System–that automates certification requests and issuance of printed certificates of surety bonds and contractor’s all-risk insurance (CARI) policies for non-Life insurance companies.

The IC has also redesigned its collection system to soon allow electronic payments through third-party payment gateways, and developed an Appointment Reservation (ICare) System that enables the agency to move stakeholders seamlessly to online from in-person visits.

The IC also enhanced its system for the scheduling and tests for insurance agents by shifting to online computerized examinations during the pandemic, among other digitalization projects.

The DOF-attached Bureau of Local Government Finance (BLGF) is also developing web-based systems to modernize its oversight of local treasury and assessment operations of the local government units (LGUs) in the country.

Among the BLGF’s priority digitalization initiatives is the expansion of the existing LGU Integrated Financial Tools (LIFT) System, composed of a web-based portal and LGU-deployed software, for the submission of the required financial reports to the DOF of all provinces, cities and municipalities, for more granular and sector-specific reporting of LGU revenues, receipts, and expenditures, and facilitate information flow with other agencies overseeing the LGUs.

Under the Local Governance Reform Project (LGRP), the BLGF will also develop the comprehensive Real Property Valuation Information System (RPVIS) to facilitate data capture and exchange on real property valuation transactions, improve the compliance reporting of appraisers, and support the requirements of government agencies on real property valuation. The RPVIS will be complemented by the computer-assisted mass appraisal (CAMA), and property tax billing and collection system to be developed and implemented in the pilot LGUs of the LGRP.

Government financial institutions such as the LandBank and DBP have accelerated the application of financial technology (Fintech) solutions to better provide assistance to small farmers and fisherfolk while expanding their retail banking services, in line with President Duterte’s goal of financial inclusion.

Their digital transformation initiatives include automating their processes in extending financial assistance, and in improving information systems to provide them with accurate and reliable data to better implement their respective programs.

For LANDBANK, it has significantly reduced the account opening time through its Digital OnBoarding System (DOBS). The DOBS enables LANDBANK customers to conveniently and safely apply for savings accounts online by automating and integrating the various sub-processes of account opening. Customers are now able to open their savings account through the LANDBANK Mobile Banking Application, without the need to go to a physical branch, and in a matter of minutes, anytime and any place where there is an internet connection. Accounts opened through DOBS reached 2.04 million as of November 2021.

LANDBANK also developed and continues to enhance its digital payment platforms which allow customers to pay dues, fees and other obligations to government and private institutions. This is to promote easier and cashless ways of doing business transactions especially with government agencies.

A total of 3.98 million transactions amounting to P113.63 billion were collected for 509 government merchants enrolled in LANDBANK’s various LANDBANK electronic and digital channels.

Another major step in LANDBANK’s digitalization thrust is the transformation of one of its subsidiaries, the Overseas Filipino Bank, into a digital-only, branchless bank—anchored on the primary goal of delivering and addressing the banking needs of Overseas Filipinos and their families.

This innovation, in particular, is aimed at expanding the reach of banking products and services to overseas Filipino workers (OFWs) to enable them to open their bank accounts, send money to their beneficiaries, pay bills, and more importantly, save their hard-earned income. The OFBank is now serving Filipinos in over 100 countries.

To intensify its support to the government financial inclusion initiatives, LANDBANK launched its Agent Banking Program whereby LANDBANK initiates partnerships with client cooperatives, LGUs, small and medium enterprises (SMEs), associations and private entities. This program helps provide basic banking services in unbanked and underserved areas in the country.

Since its introduction in 2019, several enhancements have been applied to the system, including the use of biometric technology for a more secure transaction authentication, and the use of cloud technology to support the various Agent Banking services like Transaction Account Opening, Cash-In, Cash-Out, Bill Payment, and Fund Transfer.

Using this Agent Banking solution, LANDBANK is co-locating with the Philippine Statistics Authority for the Philippine Identification System or PhilSys Registration Project, where LANDBANK is onboarding unbanked registrants for the National ID, by providing them with transaction accounts which they can use for cash-in, cash-out and fund transfer.

As of December 31, 2021, LANDBANK has onboarded 7.2 million or 45 percent of the 16 million PhilSys registrants from more than 1,000 sites, thereby making them part of the formal financial system.

Last year, Dominguez also urged anew the LGUs to adopt electronic facilities for business registration and renewal, and most importantly for assessment and collection of local taxes, fees, and charges, as the digital shift will ensure safe, efficient, and convenient ways of transacting with the local governments under the new normal.

Dominguez, in particular, directed the local treasurers, who are appointed by and under the administrative and technical supervision of the Secretary of Finance, through the BLGF, to start linking up with online payment facilities already offered by GFIs, which also serve as depository and servicing banks of the LGUs.

Another DOF-attached office—the National Tax Research Center (NTRC)—is further developing the functionalities of its existing Fiscal Incentives Registration and Monitoring System (FIRMS) for investors to allow the electronic submission in the future of reports that would enable the government to review and analyze the economic impact of investment incentives.

On top of being an application portal, the FIRMS is now being used by the IPAs and the FIRB to review, approve/reject, and monitor activities/projects.

In all these digital transformation projects, Dominguez reminded agencies to set in place sophisticated cybersecurity measures to shield their systems from hacking, online threats, and other cyber attacks.

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