STATE-owned lender Land Bank of the Philippines Inc. said Filipino migrant workers are increasingly tapping the bank’s overseas Filipino workers (OFW) lending program for local business ventures since the start of the global health crisis.
The bank said over the weekend that loan applications under the OFW Reintegration Program “increased steadily” since the Covid-19 outbreak, with total approved loans reaching P219 million for 176 borrowers from mid-March last year to end-May this year.
Under the program, eligible OFWs may avail of loans for working capital or acquisition of fixed assets at a minimum amount of P100,000 and up to P2 million for a single proprietor borrower and P5 million for a group of OFW borrowers, with a fixed interest rate of 7.5 percent per annum.
“We understand the financial difficulties being faced by many OFWs due to the ongoing pandemic that has affected overseas deployments,” LandBank President and CEO Cecilia C. Borromeo said. Borromeo added the bank is “closely working with OWWA in supporting OFWs to acquire their own businesses as an alternative source of income.”
LandBank’s program for OFWs started in May 2011. Since then, the bank has approved loans worth a total of P1.89 billion for 1,297 borrowers. Of this amount, P1.84 billion has been released as of end-May 2021.
Latest data from the Bangko Sentral ng Pilipinas showed that cash remittances grew by 12.7 percent in April to reach $2.3 billion during the month. This is the strongest year-on-year growth in remittances in almost five years.
Cash remittances expanded, following the increase in receipts from land-based workers by 15.2 percent to $1.779 billion and sea-based workers by 4.9 percent to $526 million.