For 2005 the emerging OFW cash estimates is $10.3 billion, higher than the $9.2 billion projected earlier. This is a 20 percent increase over last year’s $8.6 billion, the Bangko Sentral ng Pilipinas said.
For the first eight months to August OFW monies reached $7 billion, 28 percent higher over last year’s $5.47 billion.
In the meantime the BSP sees money transfers from OFWs increasing next year after banks channel more of these cash through formal networks and show higher OFW monthly reports.
OFW remittances made through banks – the figure reported by the BSP every month, represents only 75 percent of total cash.
Efforts by the central bank and the whole banking system to get a larger share of remittances through formal channels are expected to increase total cash from 75 percent to around 80 or 85 percent.
BSP Governor Amando M. Tetangco Jr. is encouraging Filipino migrant workers to send fund transfers through banks, which is cheaper and safer than door-to-door or other informal channels of remitting their hard-earned cash.
"We also intensified efforts to reduce the cost of remitting funds, which is a positive development for the banking system," Tetangco added.
Based on a survey conducted in June this year, service charge by "credit to account (bank)" arrangement is proven cheaper compared to door-to-door, which has the highest service charge in the fund transfer business.
Tetangco was citing the survey presented by the Association of Bank Remitting Officers Inc or ABROI, which said that one of the factors that reduces the cost of remittance is market competition. In the last five years, the survey said service charges have narrowed from 4.35 percent in 2000 to 1.50 percent this year.
Tetangco reiterated that commercial banks’ aggressive marketing campaign encouraged OFWs to utilize banking channels in transferring funds to their beneficiaries. Banks offer enhanced money transfer services, more remittance centers, tie-ups with foreign financial institutions and collection agents.
There is an estimated six million OFWs and migrants deployed abroad.
The deployment of higher-paid overseas workers such as seafarers, service staff, professional/technical workers, production related workers boost the level of remittances.
The United States of America, Saudi Arabia, Italy, Japan, Hong Kong, United Kingdom, United Arab Emirates and Singapore are major sources of fund transfers by OFWs.
