Help OFWs invest money wisely, VP urges banks

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Help OFWs invest money wisely, VP urges banks
Jan 03, 2006
Updated 05:20am (Mla time)
Cynthia Balana
Inquirer

NOTING the surge in foreign exchange remittances by overseas Filipino workers, Vice President Noli de Castro has urged banks to come up with programs to equip them with the necessary business tools to make their money grow.

De Castro made the proposal in his radio program over the weekend where Finance Secretary Margarito Teves was his guest.

De Castro told Teves that many OFWs wanted to invest in businesses but were discouraged from doing so because of their lack of business skills.

He suggested that banks, particularly those owned by the government, advise their OFW-depositors and their families on how to invest their money wisely to become successful small entrepreneurs.

The Vice President said such a program would be a big hit considering the efforts by commercial banks to attract OFW money, particularly that sent through informal channels such as returning OFWs.

"Marami sa ating mga OFWs, bibili lang ng (Toyota) FX o tricycle, tapos ipapapasada. Dahil hindi naman sila marunong mag-operate, niloloko lang ng driver hanggang malugi. Dapat siguro maging agresibo ang mga bangko para tulungan ang mga OFWs (Many OFWs buy an FX or tricycle and lease it. They don't know how to operate the business and their drivers rip them off until the business goes under. Maybe our banks should be more aggressive in helping the OFWs), " he said.

Teves agreed with De Castro, saying government-owned banks and financial institutions should be the first to help the overseas workers.

He said some P10.3 billion in foreign remittances was expected as of the close of 2005, excluding transactions coursed outside the banks. The Bangko Sentral ng Pilipinas is expecting the amount to hit P12 billion by yearend, according to reports.

De Castro said OFWs should be prepared to handle businesses when they decide to start one.

Thus, banks should help OFWs pick the right investments and explain to them what they could expect from the businesses, he said.

De Castro also said the government should take advantage of the hike in OFW remittances, the strong peso and the increasing foreign portfolio investments in the country.

He noted that in October alone, remittances coursed through banks continued to post double-digit growth from their year-ago level, although the pace of growth was about 11 percent slower than in September.

The BSP said OFW remittances in October reached $867.18 million, about eight percent less than September's level, although the amount was still 16.95 percent higher than October 2004's $741.504 million.

The BSP said the continuing increase in global demand for Filipino workers helped boost the growth in OFW remittances.

Initial data from the Philippine Overseas Employment Administration (POEA) showed that the total number of workers deployed in the first 10 months of the year reached 809,140, up from 2004's 794,806.

Of the workers deployed this year, 602,016 or 75 percent were land-based while the remaining 207,124 were sea-based.

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