BSP SUPPORTS DOLE FINANCIAL INCLUSION
The Bangko Sentral ng Pilipinas (BSP) has commended the DOLE for its embrace of financial inclusion in the payment of wages and salaries directly through banks.
BSP praised the labor department for its advisory on this.
Based on the 2019 Financial Inclusion Survey, more than two-thirds of adult Filipinos remain unbanked.
The survey also revealed that 88% of private sector wage earners receive their salaries in cash and not directly through an account. This puts the majority of workers unable to enjoy the benefits of receiving wages through an account, particularly in terms of convenience and safety.
But early this month the Department of Labor and Employment (DOLE) issued Labor Advisory No. 26-20 (Payment of Wages and Other Monetary Benefits Through Transaction Accounts) that sought to embrace financial inclusion.
The Advisory seeks to promote the payment of salaries and wages directly to the bank or e-money account (transaction account1 ) of the employees. Employers are encouraged to undertake the necessary steps to adopt account-based payment of salaries, such as assisting their employees to open a transaction account and communicating its benefits.
The use of transaction accounts for wage payments will support and catalyze adoption of digital payments among workers. Digital payment has become no longer just an option but a necessity in light of the health protocols and movement restrictions brought upon by pandemic. Having the tools for digital payments will also expand access of the workers to other welfare-enhancing digital financial services such as credit, insurance and investments.
DOLE’s Labor Advisory No. 26-20 is testament to the government’s whole-of-nation approach towards financial inclusion. BSP expresses its continuing support to DOLE in promoting the use of transaction accounts for payment of wages and empowering workers with financial tools to thrive in the new digital economy.