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RP to Seek US Help in Cutting Cost of OFW Remittances
Oct 4, 2003
Among the issues to be discussed on US President George W. Bush’s October 18 visit to the Philippines is the local government’s intention to lower the cost of OFW remittances in the US.
According to BSP deputy governor Armando Tetangco Jr., the government plans to boost OFW remittances from the US by doing two things: asking Bush’s help in lowering US-imposed fees on Filipino banks and remittance centers in the US, and getting more remittance players in that country.
A memorandum of intent to improve and strengthen Filipino remittances from the US was signed by Finance Secretary Jose Isidro Camacho and US Treasury undersecretary John Taylor during the state visit of President Gloria Macapagal-Arroyo to the US last May.
The government hopes to have Bush waive licensing and application fees charged on Philippine banks and remittance centers that want to operate in the US. This in turn could lower the remittance fees ranging from $5-$30, which Filipinos have to pay before being able to send money to their families.
Remittances may be processed through a US correspondent bank, a foreign bank, or a courier.
For the first two options, OFWs must pay an out-of-pocket fee of about $5 per transaction, a service fee charged by a correspondent bank on the deposit account of the receiving branch, and a service fee charged by the receiving bank on the deposit account of the beneficiary who gets the remittance. So for a remittance of about $200, fees would amount to an average of $16.
Couriers charge higher. For example, a $200 remittance would be charged somewhere between $22 and $27, although fees imposed by other couriers like LBC are as low as $3 for remittances from Hong Kong, Singapore, and the Middle East.
According to BSP deputy governor Armando Tetangco Jr., the government plans to boost OFW remittances from the US by doing two things: asking Bush’s help in lowering US-imposed fees on Filipino banks and remittance centers in the US, and getting more remittance players in that country.
A memorandum of intent to improve and strengthen Filipino remittances from the US was signed by Finance Secretary Jose Isidro Camacho and US Treasury undersecretary John Taylor during the state visit of President Gloria Macapagal-Arroyo to the US last May.
The government hopes to have Bush waive licensing and application fees charged on Philippine banks and remittance centers that want to operate in the US. This in turn could lower the remittance fees ranging from $5-$30, which Filipinos have to pay before being able to send money to their families.
Remittances may be processed through a US correspondent bank, a foreign bank, or a courier.
For the first two options, OFWs must pay an out-of-pocket fee of about $5 per transaction, a service fee charged by a correspondent bank on the deposit account of the receiving branch, and a service fee charged by the receiving bank on the deposit account of the beneficiary who gets the remittance. So for a remittance of about $200, fees would amount to an average of $16.
Couriers charge higher. For example, a $200 remittance would be charged somewhere between $22 and $27, although fees imposed by other couriers like LBC are as low as $3 for remittances from Hong Kong, Singapore, and the Middle East.
