The City Government of Batangas in cooperation with U.S. Embassy Manila’s United States Agency for International Development (USAID), has launched an innovative payment system that will enable 4,000 business owners in the city to pay their business taxes using their mobile phones.

Mobile money payment system was introduced through USAID’s Scaling Innovations in Mobile Money (USAID/SIMM) project and is expected to improve transparency, accountability, and security in government financial transactions by digitizing payment and collection systems.

USAID/Philippines Mission Director Gloria D. Steele said, “The new payment system is set to streamline and modernize the City Government’s business tax transactions. This supports our [U.S.-Philippine] joint goal of broad-based, inclusive and sustainable growth by promoting financial inclusion through increased access to banking and financial services, as well as transparency in government transactions.”

Business permit registration and tax payment has always been a time-consuming and costly activity for business owners in Batangas City, usually taking more than three days to complete and having to travel several times to the City Hall during registration and payment period. This has always been considered a major barrier to promoting more investments in the city. Thus, the City Government saw the value of streamlining its registration process and automating its payment system.

USAID facilitated the City Government’s partnership with G-Xchange, Inc. to enable the use of the GCash platform for the business tax payment.

Business tax mobile money payment — which can be done remotely in less than ten minutes—complements the recent success of the City Government in streamlining its business permit registration process. With the support of the USAID/Investment Enabling Environment (INVEST) Project, this process has been reduced from seventeen (17) steps which can take up to three days to complete, to two simple steps completed in just two hours.

The USAID/INVEST Project aims to improve the business environment and the competitiveness of Philippine cities, by streamlining business registration processes, reducing transactions costs, and improving investment planning and promotion.

“We believe that adopting technology in government transactions can be beneficial to our citizens. With mobile phones, business owners can now pay their business taxes anytime, without having to leave their shops or homes,” said Batangas City Mayor Eduardo Dimacuha.

In addition to mobile money, Batangas City will soon accept online and point of sale (POS) payments for other government fees as it works to digitize all its financial transactions.

Batangas City is one of three cities under USAID’s Cities Development Initiative (CDI), a program under the US-Philippine Partnership for Growth, that seeks to assist the Philippines promote higher, sustained, and more inclusive growth by providing a range of development interventions in targeted second-tier cities. The CDI was launched in Batangas City on May 3, 2012 with the signing of a Memorandum of Agreement between the City Government and USAID.