House OKS bill on credit assistance for OFWS
The House of Representatives has approved on second reading a measure establishing a credit assistance program for overseas Filipino workers (OFWs).
Akbayan party-list Rep. Walden Bello, chairman of the House committee on overseas workers affairs, said House Bill 4985 or the proposed Overseas Workers Credit Assistance Act would provide credit assistance to OFWs even before they leave the country.
Majority Leader and Mandaluyong City Rep. Neptali Gonzales Jr. and Reps. Susan Yap (Tarlac), Juan Revilla (OFW Family party-list) and Joseph Gilbert Violago (Nueva Ecija) authored the bill.
Bello said an OFW can take out a loan of not more than P50,000 from the Overseas Workers Welfare Ad- ministration ( OWWA) to defray the living expenses of his or her family during the first months of absence or to pay for recruitment expenses including placement fees, documentation costs and plane tickets.
Yap said a next-of-kin of the overseas worker-borrower should participate as co-borrower in the loan of the OFW and OWWA.
“The loan shall be covered with loan redemption insurance from any private insurance provider duly registered with the Insurance Commission,” Yap said.
She said a loan should be paid in 12 monthly installments at a preferred interest rate of not more than six percent per annum.
Only OFWs with valid employment contracts processed through licensed recruitment and manning agencies accredited by the Philippine Overseas Employment Administra- tion (POEA) are covered by the proposed act, she said.
Yap said OWWA shall accredit as many domestic or foreign banking institutions as possible which are duly authorized to do business in the Philippines in order to serve the loan payment needs of overseas workerborrowers.
“It shall be the obligation of the overseas worker-borrower to remit the loan payment regularly to OWWA through the banking institutions,” Yap said.
The bill provides that within one year after the effectivity of the measure, an online payment system shall be established wherein the OFW-borrower may pay the loan amortization through the Internet.
Failure to pay the loan or any violation of the terms of the loan shall be sufficient ground for the POEA and all its offices, including its deputized and accredited private entities and the Philippine Overseas Labor Offices (POLOs) to withhold the issuance of the Overseas Employment Certificate (OEC) and any other exit permit or clearance to work abroad to the OFWborrower concerned.
Violators face a 60-day suspension without pay for the first offense and dismissal from the service with a five-year disqualification to hold any public office for the second offense.
The private entity, which issues an OEC and exit permit to any delinquent overseas worker-borrower, shall suffer the penalty of 60-day suspension of its license or accreditation for the first offense and permanent cancellation of license or accreditation for the second offense.
The amount needed by OWWA to implement the Credit Assistance Program for OFWs shall be charged against the Overseas Welfare Trust Fund, while all payments and interest earned on the loans shall accrue to the Overseas Welfare Trust Fund.