BSP notes substantial drop in money transfer fees

Fees charged against remittances of overseas Filipino workers (OFWs) to their beneficiaries in the Philippines have become "substantially lower" over the past decade, largely due to the increase in number of money transfer facilities used by the country’s 8.7 million to 11 million OFWs, the Bangko Sentral ng Pilipinas (BSP) said Monday. The network of remittance conduits rose by 16 percent to 4,351 at the end of June from 3,370 in the same period last year. Ten years ago, remittance charges amounted to 4.3 percent of the money sent home by OFWs. As of 2010, that amount had shrunk to 1 percent to 2.5 percent, the BSP reported. BSP data showed that in 2000, the fess and charges for sending money from abroad to local bank accounts ranged from 1.5-2.5 percent, while sending money for credit in another local bank cost 1.5-3.8 percent. "Door-to-door" delivery cost 3-3.8 percent in Manila and 3.5-4.3 percent in the provinces. "Advice-and-pay" transactions cost 1.5-3.5 percent. Such charges have dropped as competition increased among the growing number of remittance units around the world, the BSP explained. Today, money transfers to local banks range from only 1-1.3 percent, and sending money for credit costs only 1-2.3 percent of the amount. The charge for door-to-door delivery, meanwhile, is now the same for areas in both Metro Manila and the provinces, usually from 1.5-2.5 percent, and the cost of advice-and-pay transactions are now only 1-2 percent. With more remittance centers and conduits set to join the network in the coming months, the remittance charges can drop even lower, said BSP Gov. Amando M. Tetangco Jr. Most money transfers originate from the US, Canada, Saudi Arabia, Japan, UK, Singapore, United Arab Emirates, and Italy, BSP data showed. Money transferred to the Philippines from these countries accounted for 81.7 percent of total remittances reported by the banks as of end-June, the BSP said. —LRS/VS, GMANews.TV