What to Know About BSP, DILG’s Paleng-QR Ph Program
MONEY

Digi-Palengke: What to Know About BSP, DILG's Paleng-QR Ph Program

Digitalizing payments is the future if not already the present. In its promotion of financial inclusion and going cashless, the Philippine government continues to bolster its efforts to make digital payments accessible to all Filipinos.

The Bangko Sentral ng Pilipinas (BSP) and the Department of the Interior and Local Government (DILG), on their end, have developed the Paleng-QR Ph Program to bring digital payments closer to public markets, community shopkeepers or sari-sari stores, and tricycle hubs in every city and municipality in the Philippines through the use of smartphones.

According to the BSP, the program takes inspiration from the student policy competition finalists from the University of the Philippines, Los Baños, during the BSP Youth Summit in 2021. It utilizes the QR Ph, also known as the national QR code standard for digital payments, which is an initiative of the BSP and the payments industry.

To encourage local government units (LGUs) to implement the program, the DILG and BSP signed a joint memorandum circular on June 21, 2022, outlining the guidelines and responsibilities of LGUs and financial service providers (FSPs) participating in the program.

For LGUs, the BSP and DILG stated that they are expected to create policies to "incentivize or mandate the use of QR Ph digital payment by market venders, tricycles, and other such merchants." LGUs are also tasked to aid these target users of the program to have their own transaction account, one of which is to hold its own "account opening day."

Baguio City as Trailblazer

Baguio City, the Summer Capital of the Philippines, became the first LGU to implement the Paleng-QR Ph Program, launching it last Aug. 14 in Malcolm Square, just in front of the Baguio City Public Market. At the time, FSPs were present to help market vendors and shop owners to open their transaction accounts and print QR codes for their own stalls.

BSP Governor Felipe M. Medalla hailed Baguio for taking not just one step but "many steps" in championing digital finance. The LGU is committed to going "beyond a resolution of support" with its plans to pass a program that will incentivize business owners who will adopt the Paleng-QR Ph as an alternative payment scheme.

"Under the ordinance, a five percent (5%) discount on all fees, licenses, permits and or taxes in connection with the establishment, operation, and maintenance of the market stall subject to the rules and regulations of the City Council in the first [three] years of the Paleng-QR Ph program. The five percent (5%) discount also applies to stall rental or rights in the first year of adoption," a BSP press release on Aug. 16 read.

Baguio Mayor Benjamin Magalong shared that the Paleng-QR Ph Program is in concordance with the LGU's goals to digitally transform the city.

"Digital technology mainly gives us all a renewed sense of purpose. What we are doing now with this launching and what we are envisioning is a big idea that will bring about unprecedented change. We have entered the age of innovation, and we need to adapt to the fast-paced world of digital transformation," Magalong was quoted as saying.

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