House panel approves bill granting OFWs discount on remittance fees

A HOUSE of Representatives committee last month approved a consolidated bill seeking to grant overseas Filipino workers (OFWs) a 50% discount on remittance fees imposed by banks.

The bill also prohibits the raising of remittance fees without prior notice to the Bangko Sentral ng Pilipinas, the Department of Finance, and the Department of Migrant Workers.

“Recognizing the significant contribution of OFWs to the national economy through their foreign exchange remittances, the State shall adopt measures to protect the hard-earned money they remit home against usurious interest rates and exorbitant fees,” according to the unnumbered substitute bill.

Remittances from OFWs rose 2.6% to $3.05 billion in March from $2.97 billion a year earlier.

Banks can then claim the discounted remittance fee as a tax deduction.

“Bank and non-bank financial intermediaries providing discounts on remittance fees may claim the discounts granted as tax deductions based on the cost of service rendered to OFWs to be treated as ordinary and necessary expense deductible from the gross income of the intermediary,” according to Section 5 of the unnumbered substitute bill.

The House Committee on Overseas Workers Affairs also approved a proposed measure requiring OFWs to attend financial literacy seminars.

The literacy seminar would discuss consumer protection and responsible borrowing, among others.

The bill requires OFWs to undergo a pre-departure orientation seminar on financial literacy. They will also need to sit through a financial education seminar “within a reasonable time upon their arrival in their respective countries of destination.”

Families of OFWs will also be provided with free online financial literacy seminars. — Kenneth Christiane L. Basilio