“The government introduced several measures in response to the COVID-19 pandemic, directed to (i) expanding coverage and/or increased benefit of cash transfer programs, (ii) modernizing delivery mechanisms, and (iii) alleviating certain restrictions on digital transactions…Other relief measures include exceptional wage and pension increases (of 14% starting next fiscal year), revised tax exemption thresholds, and increased minimum wage.”
The Philippines’ Social Amelioration Program started in March of 2020 sought to provide cash assistance to 18 million households. The first tranche of payments experienced significant delivery challenges, leading to changes in the second tranche. This case study aims to document lessons learned from the second tranche.
Payments are central to how governments transfer and receive financial resources; however, the way such payments are made is often not mainstreamed in public financial management (PFM) despite the fact that many of the direct benefits from effective digitalization of payments are identitical to those traditionally expected from strong PFM systems. The digitalization of payments does not provide a silver bullet for solving PFM problems; therefore it needs to be approached in an integrated way, with leadership from central agencies, including the Ministry of Finance, to exploit the synergies between the many different types of payments facilitated by digital technology.
The most valuable innovation is in G2P delivery systems that empower women to choose how to receive their cash.
COVID-19’s disproportionate impact on women must be urgently addressed through the provision of digital financial literacy and access.