File photo by Leo Bautista
Overseas Filipino Workers (OFWs) living in Qatar can avail the Reintegration Program, which enables them to loan up to Php5m (as per today's rate, approx QR325,000). This was disclosed during a recent financial literacy webinar hosted by the Philippine Embassy in Qatar and the Overseas Filipino Bank (OFBank).
The webinar also disclosed that the loan programme is for OFWs who wish to start up or expand their business in the Philippines. The programme is a partnership of LANDBANK, a government-owned bank in the Philippines and the Overseas Workers Welfare Administration (OWWA).
Gerald Heriales, OFBank Overseas Representative Officer in Middle East Region, said the loanable amount depends on the project needs or the capacity of the borrower to pay the loan. “The minimum amount is Php100,000; while the maximum amount is Php2m for single proprietorship, and Php5m for partnership, corporation, cooperative,” Heriales noted.
An OFW can loan 80 percent of the total project cost, while the borrower should shoulder the remaining 20 percent. Meanwhile, the eligible loan purposes are working capital, and fixed asset acquisition, while the interest rate is fixed at 7.5 percent per annum for both short-term and term loans.
Short-term loans are to be paid in one year, while term loans’ payments are based on cash flow but must not exceed seven years. If the borrower fails to pay the loan, a penalty rate of 24 percent per annum applies.
Among the type of business an OFW can venture in include any viable projects that generate cash flow sufficient to pay amortisations; with debt service cover of at least belonging to the following fields: franchising, Agri and non-Agri production/manufacturing, construction/rental, service/trading, transportation, has contract tie-up with top 1,000 corporations.
Heriales also stressed that any business unrelated to gambling would be accepted.
To be eligible for the Reintegration Program, an OFW should be an active or inactive certified OWWA member who is currently employed overseas or who applied under the programme not later than three years from their return to the Philippines, except in cases where the applicant has an on-going business prior to the time of application. Also, the applicant should have completed enhanced Entrepreneurial Development Training (EDT).
Also, a group of OFWs who formed themselves into a business entity, either a partnership, corporation or cooperative: has at least three years track record of profitable operations, all partners/stockholders are OFWs and certified as OWWA members, and have completed the enhanced EDT.
Heriales also discussed the collateral or loan security which includes an object of financing, mortgageable assets of the borrower (e.g., Real Estate Mortgage, Deed of Assignment of proceeds or market contracts, Contract Agreements, etc.) or any collateral/loan security acceptable to the bank.
He also explained that once an OFW submits all the documents needed to get the loan, it may take up to one month to be approved. Moreover, he emphasised that those with an existing loan to other banks are eligible to apply, as long as their business is in the Philippines and not overseas.
