House Approves Bill Allowing Credit Assistance for OFWs

An OFW could soon apply for credit assistance of up to P50,000 to leave his family with ample money to live comfortably, especially during the first few months after the worker flies to the country he will be working in – thanks to the proposed Overseas Workers Credit Assistance Act [House Bill 4985].

House Majority Leader and Mandaluyong City Representative Neptali Gonzales Jr., OFW party-list Representative Juan Johnny Revilla, Nueva Ecija Representative Joseph Gilbert F. Violago and Tarlac Representative Susan Yap are the main proponents of this house bill.

Ngiting Tatak Pinoy ni Dodeth Vergara

Ngiting Tatak Pinoy ni Dodeth Vergara : 2010 PEBA Photo Contest Entry

Very Useful Credit Assistance

Even before an OFW leaves the country, he will surely incur a lot of expenses – whether in plane tickets, placement fees, documentation costs, and other charges [airport terminal fees???] that might be needed before he is finally allowed to go.

Also, the family he leaves behind surely needs money for their living expenses, especially if the OFW is the sole breadwinner. Moreover, the OFW could not immediately send back money within days of working abroad, so the family is often forced to take credit from loan sharks who put high interest rates on their short-term loans.

To help solve this problem, the bill’s proponents passed the proposal to grant the OFWs with a loan of up to P50,000. It is up to OFW to use this money, whether to pay for placement fees incurred, plane tickets, or to leave to his family.


The full requirements have not yet been released, but OFWs are expected to present “valid employment contracts processed through licensed recruitment and manning agencies accredited by the Philippine Overseas Employment Administration (POEA)”, reports GMA News.

The next-of-kin who would be the recipient of the loan also needs to sign as co-borrower.

Payment Terms

It comes as great news that this loan only has a 6% interest rate per annum (year), so it will not be too hard on the OFW’s pocket. Moreover, payment terms are easy. They are allowed to repay the loan for up to 12 months, on installment.

It is the responsibility of the OFW to repay the loan through the Overseas Workers Welfare Administration (OWWA) via accredited banks.

The bill also indicated that within 12 months after this credit assistance bill is implemented, online payments should already be made available so that OFWs can easily repay the loans using online banking and payment facilities.


The OFW is expected to repay the loan diligently or risk grave sanctions. Failure to repay the loan can be grounds for the POEA and all its offices to withhold the issuance exit permit, clearance to work abroad, or Overseas Employment Certificate (OEC).

Private agencies who fail to repay the loans for the OFWs will be suspended for 60 days on the first offense. If the agency violates the program again, then the POEA has the right to cancel its license or accreditation.

Government officials/employees who violate the provisions of this bill will also face a 60-day suspension for the first offense. If that particular employee/official violates the provisions a second time, he will be dismissed from service and banned from working or holding public office for up to 5 years.

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