Overseas Filipino Workers (OFWs) are about to benefit from a major financial relief as the Philippine House of Representatives has passed House Bill No. 10959, known as the Overseas Filipino Workers Remittance Protection Act. The bill, which received 174 votes in favor during its third and final reading, mandates a 50% reduction in remittance fees, alleviating the financial burden on OFWs sending money back home.
How the Law Works
Once it becomes law, this legislation will require banks, remittance centers, and financial institutions to cut their fees in half for OFWs.
Eligible Beneficiaries: All OFWs who send money to their families in the Philippines will be eligible for the discount.
Scope of the Discount: The discount applies to fees charged by both banks and remittance agencies.
Monitoring & Compliance: Regulatory bodies, including the Bangko Sentral ng Pilipinas (BSP), will monitor compliance to ensure that financial institutions adhere to the reduced fees.
Why This Matters
Remittances serve as a vital support system for millions of Filipino families. In 2023, personal remittances from OFWs reached USD 37.2 billion, mainly from countries such as the United States, Saudi Arabia, and the UAE. This financial relief enables OFWs to send a larger portion of their hard-earned money directly to their families, lessening the impact of high transaction fees.
Potential Impacts
For OFWs:
– Greater financial relief.
– Increased disposable income for families dependent on remittances.
For the Philippine Economy:
– Boosted remittance inflows as lower fees encourage more frequent transactions.
– Enhanced consumer spending driven by higher household income.
For Financial Institutions:
– A potential decline in revenue from transaction fees, but this may be balanced by an increase in transaction volume.
