RULE I
PRELIMINARY PROVISIONS

RULE II
DIGITAL PAYMENTS FOR GOVERNMENT DISBURSEMENTS

Section 2.1 Guiding Principle. All Covered Agencies shall utilize safe and efficient digital disbursement in the payment of goods, services, and other disbursements, including in the distribution of financial assistance, as well as in the payment of salaries, wages, allowances, and other compensation to employees. Covered Agencies shall be allowed to disburse funds directly into the transaction accounts of recipients or beneficiaries, whether held in government or private financial institutions.

Section 2.2 Responsibilities of the Covered Agencies. All Covered Agencies shall have, among others, the following obligations:

Section 2.3 Responsibilities of the GSBs. The GSBs shall have, among others, the following obligations:

a. Executive payment instructions in accordance with the settlement periods to be provided under the service level agreement for ADA, and in accordance with the processing time for EFT services set out under the rules of the Automated Clearing House (ACH) and regulations prescribed by the BSP;

b. Submit to the government entity disbursing the fund a verified lidt of successful or failed fund transfers, together with all relevant details. At the minimum, the report should have the following basic information:

1. Recipient or beneficiary information such as name, transaction account details such as name of bank and branch or e-money issuer and account number; and

2. Amount Due.

Reports on successful or failed fund transfers should be transmitted to the government entity disbursing the fund two business days after the disbursement.

c. Subject to service level agreements, which may be guided by standard provisions to be defined by the Technical Working Group of EO No. 170, GSBs may be allowed to collect fees from Covered Agencies for EFT services; and

d. Notify the government entity disbursing the fund of any expected service disruption which may cause delays in disbursing funds to recipients and beneficiaries. Likewise, GSBs shall issue a public notice in relevant channels, including social media, to provide proper guidance to those expecting the disbursements.

Section 2.4 Rights of the recipients and beneficiaries. The recipients and beneficiaries are entitled to the following:

a. Right to choose and nominate the transaction account into which Covered Agencies will disburse the funds, which may be held in a government or private financial institution, provided that the institution is a participating receiving entity of an interoperable EFT scheme;

b. Right to rectification of the inaccuracy or error in their transaction account details and have it corrected immediately and accordingly, unless otherwise unreasonable. If the transaction account detail has been corrected, the Covered Agencies shall ensure the accessibility of both the new and the retracted information and the simultaneous receipt of the new and the retracted information by the GSBs; and

c. Access to adequate information regarding digital payment of govenrment disbursements, including distribution of financial assistance.

Section 2.5 Public Service Continuity Plan. All Covered Agencies shall provide in its Public Service Continuity Plan the policies and procedures that will be followed in times of calamities or other emergencies when payments through digital means may not be fulfilled after exhausting all possible means. In these cases, non-digital payout channels may be considered by Covered Agencies in the exigency of service.

Section 2.6 Compliance with Data Privacy Act. Covered Agencies and GSBs shall ensure that the provisions of RA NO. 10173 or the "Data Privacy Act of 2012," its implementing Rules and Regulations, and all relevant issuances of the National Privacy Commission, shall be observed in the implementation of EO No. 170 and this IRR.

RULE III
DIGITAL PAYMENTS FOR GOVERNMENT COLLECTIONS

Section 3.1 Guiding Principle. All Covered Agencies are mandated to offer a digital mode of collecting payments for taxes, fees, tolls, and other charges and impositions. Acceptance of cash and other traditional modes of payment shall not be discounted and shall be offered in addition to digital modes of payment.

Section 3.2. Procurement of PSP. Covered Agencies shall utilize secure payment processing solutions to ensure that various digital payment methods are accepted. For this purpose, Covered Agencies may engage the services of established Payment Service Providers, provided that only interoperable digital payment solutions which are compliant with the National Retail Payment System Framework shall be availed.

Subject to existing laws, rules and regulations, the partner PSP of Covered Agencies shall not be limited to Government Servicing Banks.

Section. 3.3. Responsibilities of the PSP. The PSP shall have, among others, the following obligations:

a. Define process and ensure issuance of Acknowledgement Receipts for payment/s made through digital platform;

b. Process personal and sensitive personal information in the system in accordance with the provisions of the Data Privacy Act of 2012, its implementing Rules and Regulations, and all relevant issuances of the National Privacy Commission;

c. Perform the responsibilities and functions as set out in the Standard Terms of Reference or Standard Minimum Terms and Conditions to be issued by the Technical Working Group of EO No. 170 which shall include, among others, standards on timely processing of payments and appropriate recourse and support for issues and concerns encountered by Covered Agencies and the transacting public.

d. Remit or deposit intact the full amount of collections due to the government to the appropriate account in the AGDB (Authorized Government Depository Bank) within the next banking day from the collection date or within the period as may be prescribed by TWG.

e. Provide a reporting facility where government agencies can view and download details of collection in real-time.

Section 3.4 Responsibilities of the Covered Agencies. All Covered Agencies shall have, among other, the following obligations:

a. Define process of electronic issuance of invoice and/or billing number for on-time and late payments of taxes, fees, tolls, and other charges and impositions;

b. Ensure that their payment channels are adequate, visible, available and accessible to the transacting public;

c. Promote and encourage use of the digital payment channels and provide adequate support to the transacting public;

d. Ensure compliance with existing applicable regulations on electronic collection; and

e. Perform such other functions as may be prescribed by the Technical Working Group of EO No. 170.

RULE IV
TECHNICAL WORKING GROUP ON THE ADOPTION OF DIGITAL PAYMENTS

Section 4.1 Composition of the Technical Working Group (TWG) on the Adoption of Digital Payments. Pursuant to Section 5 of EO No. 170, a TWG shall be constituted composed or representatives from the following agencies and offices:

a. DOF;

b. DBM;

c. BTr;

d. BIR; and

e. Government Procurement Policy Board (GPPB) Technical Support Office.

Section 4.2 Designation of Permanent and Alternate Representatives to the TWG. To ensure representation and facilitate coordination and collaboration on all matters relative to the functions of the TWG, a senior official with a rank not lower than an Assistant Secretary or its equivalent of each member agency shall be designated by the head of agency to be a permanent representative in the TWG within fifteen (15) days from the effectivity of this IRR. Alternate representatives, with a rank not lower than Director IV or its equivalent, shall also be duly endorsed by the head of the agency.

The permanent and/or alternate representatives shall be responsible for overseeing their respective agency's overall efforts in the implementation of EO No. 170 and this IRR.

Section 4.3 Functions. The TWG shall have the following powers and functions:

a. Develop and drive implementation of strategy and programs to ensure effective and cost-efficient procurement of PSP and other digital collection services in the government, including the LGUs. This may include review and/or negotiation of the transaction fee/s and standard merchant discount rate for all government payments. This information will be used to determine the proper Approved Budget for the Contract (ABC), if necessary;

b. Provide guidance on the standard provisions in the service level agreement or memorandum of agreement between GSBs and Covered Agencies with respect to digital disbursements;

c. Oversee and monitor the procurement of digital payment solutions by Covered Agencies and ensure that the same is in accordance with existing laws, rules and regulations;

d. Consider the formulation of standard terms and conditions for PSPs, in consultation with the BSP and COA. Pursuant to its mandate to formulate and amend public procurement policies, rules and regulations in accordance with Section 63 of Republic Act No. 9184, the GPPB may also issue specific procurement guidelines for the engagement of PSPs, if necessary.

e. Develop principle-based guidelines which should cover, among others, the following areas:

i. Standardization of reports on the successful or failed fund transfer for ease of reconciliation

ii. Consumer assistance and complaints handling

iii. Rules on generation, issuance and recognition of electronic official receipt

iv. Preparation of payment instruction

v. Measures to prevent double disbursements

vi. Progress reports of covered agencies on their respective collection and disbursements.

f. Resolve issues relative to the implementation of this Order, without prejudice to the individual member-agencies resolving such concerns pursuant to their respective mandates;

g. Develop and utilize operational readiness criteria and capability assessment for the adoption of digital payments for government collections of all Covered Agencies;

h. Develop and implement a communication and advocacy plan, in coordination with the Communication Working Group of the Financial Inclusion Steering Committee, to: (a) brief Covered Agencies on the goals and requirements of the EO No. 170; and (b) educate the public on the necessity and benefits of owning a transaction account and using digital payments, through information and awareness campaigns and financial literacy programs;

i. Call on any department, agency or office under the Executive Branch for the effective implementation of this Order;

j. Develop, recommend and/or implement appropriate mechanism to enforce full compliance of all Covered Agencies with the provisions of EO No. 170 and this IRR; and

k. Perform such other functions as may be directed by the President.

Section 4.4 Structure and Organization. The TWG shall be chaired by the permanent representative of the BTs while the members shall be comprised of the permanent and alternative members of the other member agencies. The BTr shall also serve as the TWG Secretariat. For its Secretariat riles, the BTr may request the assistance of the BSP and other agencies on the agenda setting and coordination with the financial services industry and other stakeholders for the TWG meetings.

Section 4.5 Responsibilities and function of the TWG Secretariat. The TWG shall provide technical and administrative support services, and undertake the following:

a. Liaise and coordinate the activities of the TWG in the performance of its functions;

b. Prepare and recommend the agenda, resolutions, minutes, and other similar documents for the TWG meetings;

c. Receive and consolidate submissions of transition plans by Covered Agencies;

d. Develop and maintain a monitoring and evaluation system on the status of the approval and implementation of the transition plans to be submitted by the Covered Agencies;

e. Maintain the documents and records of the TWG, furnish copies thereof to the TWG members in a timely manner; and

f. Perform such other tasks as may be directed by the TWG.

Section 4.6 Advisory Body. There shall be an Advisory Body to the TWG, which shall include but not limited to the following:

a. Commission on Audit (COA);

b. Department of Information and Communications Technology (DICT);

c. Department of the Interior and Local Government (DILG); and

d. Philippine Payments Management, Inc. (PMMI).

The TWG may consult the Advisory Body in its regular meetings and other activities. However, no voting rights shall be granted to the members of the Advisory Body.

Section 4.7 Meetings and Quorum. The regular meetings of the TWG shall be held at least once every quarter. Should special circumstances arise to warrant the holding of another meeting, a special meeting may be convened by any of the member agencies of the TWG subject to the concurrence of the Chairman. Representation from three out of five member agencies shall be required to determine a quorum and call the meeting into order.

RULE V
TRANSITION PERIOD

Section 5.1 Implementation Period and Tiering Guidelines. All Covered Agencies shall ensure the proper transition of their respective agencies' disbursement and collection procedures and policies to accommodate digital payments towards the full implementation of this Order. Covered Agencies shall ensure the continuous delivery of public services during such transition, particularly the acceptance of non-digital mode of payments.

All Covered Agencies shall fully implement digital disbursements in their respective agencies within six (6) months from the effectivity date of this IRR.

For the implementation of digital collections, a tiered period not exceeding three (3) years shall apply. The transition period reflects the operational readiness and capability of an agency to implement digital payment solutions.

    

Operational Readiness and Capability Assessment	Transition Period
Covered agency is already offering digital mode of collecting payments in some of its public-facing transactions through a payment gateway or a collection agreement with financial institutions	Within 1 year
Covered agency is not yet offering digital mode of collecting payments	More than 1 year but less than 3 years

Section 5.2 Preparation of Transition Plan. All Covered Agencies shall assign their respective payments digitalization team to be headed by a senior official, with a rank not lower than Assistant Secretary or it equivalent, to coordinate and oversee the entire process. The constitution of these teams and the names of their heads shall be submitted to the TWG Secretariat not later than fifteen (15) days upon the effectivity of the IRR for communication and monitoring purposes.

The payments digitalization team of the Covered Agencies shall submit a transition plan that shall include, but are not limited to, the following:

Section 5.3 Submission of Transition Plan. The transition plan shall be officially transmitted by the head of agency to the TWG, through the Secretariat, within sixty (60) days after the effectivity of this IRR. The transition plan will be used as part of the basis for monitoring compliance of the Covered Agencies. Whenever necessary, the TWG may recommend adjustments in the transition plan in line with the requirements and objectives of EO No. 170.

RULE VI
FUNDING

Section 6.1 Funds for implementation. The amount necessary for the initial implementation of this order shall be sourced from the existing appropriations in the case of NGAs, and the respective corporate funds of GOCCs, subject to availability thereof, and existing budgeting, accounting, and auditing rules and regulations.

The amounts necessary for the subsequent years shall be included in the budget proposals of the covered agencies, subject to the annual budgetary process.

The amounts necessary for the initial and subsequent implementation of EO No. 170 shall include the reasonable costs of establishing and maintaining infrastructure and system relating to digital payments, including transaction fees, as well as other expenses that may be incurred in connection with the implementation of said EO.

RULE VII
DIGITALIZATION SUPPORT

Section 7.1 Capacity Building. The DICT, Department of Trade and Industry (DTI), and Department of the Interior and Local Government (DILG) shall aid in the capacity building of Covered Agencies relative to the adoption of digital payments. These agencies may coordinate with the BSP, the PPMI, and other stakeholders including indistry players and development partners to develop capacity building programs for the Covered Agencies.

Section 7.2 Connectivity. The DICT shall take appropriate measures to ensure adequate internet connectivity to support government programs and policies on the digitalization of financial transactions.

RULE VIII
MONITORING AND EVALUATION

Section 8.1 Monitoring and Evaluation Mechanism. To ensure delivery of commitments and compliance of the Covered Agencies to the EO, each agency shall submit to the TWG and COA, through the Secretariat, a bi-annual report containing the following:

Section 8.2 Incentive for voluntary participation of LGUs. The DILG, in its assessment process for the granting of the Seal of Good Local Governance, shall accord meritorious consideration of an LGU's initiative to comply with the provisions of EO No. 170 and this IRR.

RULE IX
FINAL PROVISIONS

Section 9.1 Separability. If any provision of this IRR is subsequently declared invalid or unconstitutional, the other remaining provisions not affected thereby shall continue to be in full force and effect.

Section 9.2 Repeal. All issuances, rules, and regulations or parts thereof, inconsistent with this IRR are hereby repealed, amended, or modified accordingly.

Section 9.3 Effectivity. This IRR of EO No. 170 shall take effect immediately upon its publication in the Official Gazette or in a newspaper of general circulation.

Approved this 26th day of October 2022.