Pay.gov, the federal government's web portal for collecting payments to federal agencies, is now offering PayPal and Dwolla as payment options.

The move coincides with the U.S. government's transition from paper-based processes to electronic transactions. Digital wallets like those provided by the two companies allow users to initiate transactions on the Internet or through their mobile devices without supplying the government with personal information.

In fiscal year 2014 the Treasury Department's fiscal service bureau collected $3.7 trillion in revenue through 400 million transactions using Pay.gov and other programs, it said in a news release Wednesday. Nearly 98% of those transactions were settled electronically.

"Digital wallets provide convenience, simplicity, and a trusted customer experience, while achieving cost effectiveness for the federal government," Corvelli McDaniel, the Treasury unit's assistant commissioner of revenue collections management, said in the release.

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