MANILA – A state agency announced it started to provide “soft” loans to overseas Filipino workers (OFWs) who were retrenched from their jobs due to the global economic and financial meltdown.
Secretary Marianito Roque of the Department of Labor and Employment said the loan program being offered by the Overseas Workers Welfare Administration (OWWA) is part of the package crafted by the Arroyo administration to enable the retrenched OFWs to cope with the crisis.
An attached agency of the labor department, Roque said OWWA is one of the government offices tapped by President Gloria Macapagal-Arroyo to participate in what is known as the Comprehensive Livelihood and Emergency Employment Program.
For her part, Carmelita Dimzon, the OWWA administrator, said each qualified OFW can avail of a maximum loan, equivalent to more than $1,000, to start or expand his livelihood project.
Because it is considered a “soft” loan, Dimzon explained the money is available at low interest, no collateral and payable over 24 months after a grace period of 90 days with no interest.
The OWWA chief said her agency started providing the loan after the labor department approved the procedures for its availment under an administrative order signed by Roque on January 19.
The order defines a displaced OFW as one who has been retrenched from his job on or after October 15, 2008. The reasons for the termination are closures or downsizing of their companies due to the global economic crunch..
The applications, Dimzon said, may be filed with the family welfare offices of the OWWA regional branches throughout the country.
According to Dimzon, the OWWA board of trustees has allocated a total of $20 million for the lending program as an economic safety net for the displaced OFWs.
But, at the same time, Dimzon emphasized that the OWWA board also issued guidelines on who can participate in the program.
For one thing, she said each OFW will be required to attend free business courses on the production and management of his chosen livelihood project before he can apply for the loan.
Such skills are important to an OFW who wants to transform himself into an entrepreneur with a sustainable income-producing project in the long term, Dimzon said.
The applicant can learn these skills for free, she added, at the regional facilities of the Technical Skills and Development Authority (Tesda) which is also an active participant in the program.
Dimzon also said the loan requirements include: proof of OWWA membership, proof of displacement due to the crisis, business proposal, financial statements where the applicant and/or his family have an existing business, promissory note as well as marital consent for a married borrower.
An OWWA spokesman explained proof of OWWA membership is a must because many OFWs, particularly those hired by illegal recruiters, have left the country without registering with the agency as mandated by law.
As a registered OWWA member, the spokesman stressed this entitles the OFW to financial, legal and other forms of assistance from the government in case of death or dismissal from his job.
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