Reimagining government payouts with programmable money (p1.)

Open Government Products
Open Government Products
4 min readApr 4, 2023

By Paul Hong Tay and Sheikh Salim

What if we were able to receive government payouts in digital currency?

In November 2022, we partnered with the Development Bank of Singapore (DBS) to conduct Singapore’s first-ever trial on the use of Purpose-bound Money (PBM), a tokenised digital currency, for government voucher payouts. The trial is part of the Monetary Authority of Singapore’s (MAS) Project Orchid, which explores how to develop the technology to issue a retail CBDC (i.e., a digital version of Singapore dollar cash) and explore potential use cases for programmable money in Singapore.


Since we first developed RedeemSG, a voucher system for the Singapore government, we have been exploring ways to make the distribution of government vouchers easier, faster, and more cost-effective. RedeemSG enabled the use of government vouchers with any mobile device and allowed merchants to conveniently receive their payouts by the next day. As we powered more voucher campaigns, such as the CDC vouchers scheme, we discovered more challenges faced by both the public and private sector in implementing their campaigns:

  1. High cost of implementation

For every voucher scheme implemented, campaign organisers would need to work out a host of implementation details (e.g. where vouchers should be spent, how to disburse the vouchers). This could take months or even years. To make this more efficient, several merchants and campaign organisers commissioned their own voucher systems which could cost thousands or millions of dollars to build.

2. Slow and costly settlement processing

Multiple parties have to run their own reconciliation processes upon the collection of vouchers, which can be slow and costly. This can also result in a long and costly dispute resolution process should there be any discrepancies between the parties.

3. High resource cost of contracting for each scheme

Whenever there’s a new voucher scheme, the government agency would need to reach out to each merchant to onboard them. Even if these merchants were already using RedeemSG, the merchant would still need to sign a separate contract as the voucher conditions and issuer were different.

We also identified some core requirements for government voucher campaigns:

  1. Government vouchers are organised in terms of specific schemes
  2. Within the same scheme, recipients always get the same amount of vouchers
  3. Vouchers can be created for monies earmarked by the government campaign organiser, where the sum of total vouchers is less than or equal to the monies set aside
  4. Vouchers can be redeemed at specific merchants
  5. Merchants should be reimbursed quickly once the voucher is redeemed
  6. Vouchers should have expiry dates

Purpose-bound Money as the solution

Purpose-bound Money is a protocol specifying the conditions upon which an underlying digital currency can be used. PBMs are bearer instruments (non-cash form of money) with self-contained programming logic and are transferrable between two parties without intermediaries.

Given these characteristics, we thought PBM could fulfil the requirements of a government voucher campaign and be a possible solution to many of the issues government campaign organisers and merchants faced.

With PBM, we hope to be able to:

  • Design a protocol where the government can give Singaporeans digital money that can only be spent if certain conditions are met. Upon receiving this digital money as payment, merchants will directly receive cash. By doing so, we eliminate the need to onboard merchants to each voucher scheme, as the merchants no longer receive actual vouchers. Thus, merchants are also no longer exposed to the voucher issuer’s default risk.
  • Address the reconciliation issue by having a single ledger serving as the source of truth that is immutable, time and date-stamped, and transparent to all parties involved. This system should also contain an audit trail to provide instant traceability if there’s a dispute between any 2 parties.
  • Accommodate most of the complex government voucher campaign requirements.

In our next article, we will share in detail the Project Orchid trial we ran with DBS, diving into the core decisions, parties and accounts, smart contracts, processes, and our user journey design. We will also share how the trial demonstrated success, and the next steps moving forward.

If what we are doing excites you, join our team on our mission to transform the payments ecosystem in Singapore! We are hiring 🙌


Special thanks to the CBDC team for the hard work in making the trial a huge success!

Paul Hong Tay, Senior Product Manager at Open Government Products

Sheikh Salim, Software Engineer at Open Government Products

Talitha Chin, Senior Product Manager at Open Government Products

Pallani Kumaran, Lead Cloud Infrastructure Engineer at Open Government Products



Open Government Products
Open Government Products

We are Open Government Products, an experimental division of the Government Technology Agency of Singapore. We build technology for the public good.