I’ve been advocating OFW issues and concerns in our blog but one issue that I am very keen of, is the creation of an OFW Bank. There are many organizations that I am affiliated with, like in the past the Bohol-Leyte OFW Cooperative, OFW Cooperative Council, OFWNet, United OFW, and at present Kalipunang Kaakabay ng Manggagawang Pilipino, OFW Congress, and even Partidong Pandaigdigang Pilipino (PPP), the proposed political party of OFWs, all of these groups tackled the possibility of creating an OFW Bank that will cater the real needs of OFWs and their families.
Also, there have been bills filed in Philippine Congress that seek the creation of a bank for OFWs, the Senate Bill No. 639 by Sen. Manuel B. Villar, Jr.; House Bill No. 723 by Rep. Judy J. Syjuco; and HB No. 1565 by representatives Jaime C. Lopez and Prospero Nograles. Up to this date, the mentioned bills are among those stacked of files found in the dim lit areas of the House of Congress.
There was even a proposal from Vice President Jojo Binay, who is also the Presidential Adviser on OFW Concerns submitted to the Office of the President but there are many sectors of government opposed the plan for the creation of an OFW Bank.
The featured article below by: Romie Cahucom will give an update on this issue and perhaps – would be solution to the most awaited OFW Bank.
Remittance Is Not the Enemy, Economic Reintegration of Returning OFWs Is
For this post, we get back to the OFW bank issue by offering a sort of brief rebuttal to the first two (2) objections of Bangko Sentral and the Department of Finance on the proposal of Vice-President Jejomar Binay for the formation of an OFW bank way back in 2010.
We recall that Vice-President Binay, way back on November 22, 2010, sent a formal letter to President Benigno Aquino III recommending the establishment of an OFW bank which “will provide an alternative yet viable economic financial and remittance institution for our kababayans at the local and international levels”.
As reports go, the Bangko Sentral and Department of Finance “had advised the Palace against the scheme, citing issues of cost, redundancy, administrative and regulatory unwieldiness, and sending signals that discourage current private-sector competition which, they claimed, already benefits OFWs by way of driving down transaction costs.”
President Aquino then, upholding the position of government regulators, did not approve the OFW bank proposal.
Vice-President Binay, despite the disapproval, vowed to work on with the OFW bank initiative “to encourage savings and investment among OFWs”.
It is presumably in this light that the Vice-President commissioned the Technical Working Group (as I mentioned in previous posts) to prepare a study for the establishment of an OFW Development Bank.
For purposes of this post, I assume that the recommendation of Vice-President Binay is for an OFW bank along the same lines as the following report from dailies:
“The OFW Bank project was first conceptualized in 2006 to consolidate the financial assets and operational capabilities of government financial institutions like the Land Bank of the Philippines (LBP), Development Bank of the Philippines (DBP), Overseas Workers Welfare Administration (OWWA), and the Philippine Postal Corporation (PPC), together with its subsidiary Philippine Postal Savings Bank (PPSB), as lead entities towards the creation of a financial institution for overseas Filipinos that is less expensive and more focused in its direction and services.”
Now for the brief general rebuttal on the first two (2) points raised by the government regulators (We shall take up the rest of the objections in a future post).
The Issue of Cost
Forget about the previous (2006) proposal involving Land Bank, DBP, Philippine Postal Corporation and the Philippine Postal Savings Bank. The solution is simply to buy an existing savings or thrift bank to jumpstart and start the OFW bank rolling. This is not a big deal as I am sure it is not difficult to find a small bank up for sale which should be based in Metro Manila or nearby.