What OFWs Can Do as More Remittance Services Shut
With a little over two million overseas Filipino workers (OFWs) around the world, remittances, or the money sent home by OFWs, are considered one of the major drivers of the Filipino economy over the past few years.
From January to July this year, the Bangko Sentral ng Pilipinas (BSP) said OFWs remitted $15.3 billion to the Philippines, registering a 3% growth over the same period in 2015. Such contributions from the Filipino diaspora placed the Philippines third in the list of largest remittance receiving countries in the world—just behind populous India and China, according to the latest World Bank data.
But more than contributing to the economy, it’s making their loved ones feel they are remembered that’s on top of the minds of many OFWs.
RB Balanza, who moved from Manila to California in the United States 30 years ago, explains the importance of keeping in touch with his family and friends at home and regularly sending money to them.
“I’m helping a lot of people and I’m making a lot of people happy,” Balanza says. “That’s pretty much a general Filipino culture, to help their family.”
It may be just one way to do it, but sending money back home, an act of giving something they’ve worked hard for, might be the strongest way for OFWs to stay connected with their loved ones.
The alternative to sending money home
Today, however, this connection faces a challenge—from the continued global crackdown on money transfer operators (MTOs).
A recent report by the World Bank says major international banks are still closing down MTOs’ banking accounts to keep financial crimes such as money laundering from happening.
The global lender cited the Philippines as an example, which had 84 accounts of 32 of its remittance providers closed in 13 major remittance-sending countries over the past two years. Many of the firms affected by the global shutdown are offline firms which handle cash, which is more susceptible to fraud.
The widespread movement has taken its toll on remittance costs, which is a setback to OFWs. BSP Governor Amando Tetangco Jr. raised this concern during the Financial Inclusion Summit last April. He said the so-called de-risking strategy of foreign banks may push OFWs to depend on informal remittance channels, resulting in the “deprivation of access to safe and reliable financial services.”
However, Tetangco also noted the emergence of technological advancements that “promise more cost-effective remittance channels.” Citing a Juniper Research global survey, the BSP governor said consumers are most likely to support such innovations, including online and mobile money transfers.
Romulo Velasquez proves this to be true, as he relies on online money transfer operator WorldRemit to receive money from his family abroad. “My brother lives in London. Sometimes, he sends goods or packages for me.”
In 2009, Velasquez suffered a stroke. “Right away, [my brother] sent money to my sister,” he explains. “He does it in the computer. He calls and tells me to wait for the text message for the control number. Once you get that, then you get the money,” Velasquez says. “It’s much easier for him to use WorldRemit to send money to me… the place where I get the money, it’s two streets from [my home].”
Like Velasquez, OFWs can look into other ways to send money to their families at home as the closure of MTOs’ banking accounts continues—with the best option of maximizing technological innovations that are convenient, safe, and fast—so as not to lose touch at home.
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Like Velasquez, OFWs can look into other ways to send money to their families at home as the closure of MTOs’ banking accounts continues—with the best option of maximizing technological innovations that are convenient, safe, and fast—so as not to lose touch at home.
Filipinos in more than 50 countries use WorldRemit to send remittances home. Money can be sent instantly to banks accounts, for cash collection at thousands of locations across the Philippines or added instantly to Globe Gcash and SMART accounts.
Visit worldremit.com, or download the app on iOS or Google Play.
(Source: GMAnetwork.com)