$1 remittance fee for overseas Pinoys bared

A nationwide federation of cooperatives launched on Tuesday a one-dollar remittance scheme for overseas Filipinos. Dubbed as National Cash Card program, or simply N-Cash, the new remittance system offers overseas Filipinos a much cheaper option in sending money to their loved ones in the Philippines. It is a project of the National Confederation of Cooperatives (Natcco) in coordination with the government-owned Development Bank of the Philippines. Natcco executive officer Cresente Paez told newsmen in a press conference at the project launching at the Asian Institute of Management (AIM) in Makati City that even Filipino TNTs (short for tago ng tago) can avail themselves of the lower remittance fee. N-Cash is a cash card issued by Natcco and can be used not only for card-to-card remittance from overseas but also for pre-paid cellphone loading and bills payment for the locals, according to Paez. “Filipinos in all areas of our island nation will now be able to conduct many financial transactions without having to go to their nearest urban center which is often many kilometers and many hours away" Paez said. Transactions using N-Cash can be done through the Natcco electronic facilities provided by its technology partner, iPay Solutions. “The agreement allows Natcco to use the payment platform developed by iPay to offer our member cooperatives and individuals basic financial services that are more easy and convenient to use" Paez said. Paez said the basic financial service has two critical aspects: the N-Cash and Cooperative (Coop) Kard that can be used to pay for goods and services purchased from participating merchants or any OneCard Network merchants, as well as for money transfer to and from family, friends and relatives here and abroad; cell phone loading; discounts and giveaways; and, most importantly, access to a potentially unlimited source of cooperative business opportunities for the member. Parez said the $1 remittance fee is a fixed rate, but Natcco would implement a ceiling on the amount of remittance that can be sent to the Philippines. Natcco chairman Wilfredo Dimamay said the ceiling for N-Cash is $2,000. “We are still working with the authorities in Europe, other Asian countries such as Singapore, Hong Kong and Taiwan and in the Middle East for the ceiling that we will impose on remittances of the OFWs and TNTs there," Dimamay said. Dimamay said. N-Cash cards are tamper-proof and “very much secured," according to Dimamay. The card-based nationwide payment system was developed by Filipino IT professionals anchored on text messaging. Overseas Filipinos can avail of the N-Cash program by using their bank accounts. “The TNTs can also avail of this program. They can link their bank account to Natcco’s member-cooperatives. This is regulated by the Anti-Money Laundering Council to prevent the system from being used as venue of money launderers. We also complied with the bank requirements. The card does not include full information of the owner. It will only indicate the account number" Dimamay said. DBP’s Articer Quebal said the N-Cash program was intended to ease the burden of OFWs in sending their remittances through private financial institutions such as the banks that impose higher fees for remittances. “DBP wants to serve the OFWs with less service fees. This (N-Cash) is a very good partnership with Natcco. The objective of the OFWS in going abroad is to ensure that there is food on the table of their families, that they can send their children to school for education and sustain the livelihood of their families," the DBP official said. Senator Juan Miguel Zubiri, chairman of the Senate committee on Cooperatives, lauded Natcco’s initiative as he called on commercial banks and other institutions to follow the lead by reducing their charges on overseas remittances. Zubiri revealed that on his way to the launching of N-Cash, he received phone calls from representatives of two big financial institutions, warning him of the possible negative impact of the $1-remittance fee through the N-Cash. “But I think their main concern is that it will affect their income" Zubiri said. “I don’t believe them. This should not be a monopoly of the banks. They should innovate or they will lose out," he said. The senator noted that bigger private financial institutions stand to lose roughly $1.5 billion every year in remittance fees from OFWs who would likely switch to the N-Cash program. “This is really a public service. I strongly feel that the government should support the N-Cash program," Zubiri said. “We are an archipelago of 7,107 islands. Physically, it is just too difficult for our financial sector to reach out to every island to offer each of our 85 million fellow Filipinos there the basic financial services we need, such as the ability to access cash conveniently to have accessible facilities for payment of utilities bills and loans and importantly a cost effective means of remittance," Zubiri cited. Remittances from abroad this year had been projected to reach $14 billion, up from last year’s $12.8 billion. Zubiri noted that it cost the OFWs $1.7-billion to send the $12.8 billion to their loved ones in the Philippines. “The average transaction cost of remittance is 13.5 percent. It is reported by the International Monetary Fund that the average amount remitted by Overseas Filipinos is $200 a month and 13.5 percent of that then is $27. If you divide the $12.8 billion remitted last year by the average remittance of $200,that equals to 64 million remittance transactions last year" Zubiri said. With the N-Cash program, it will bring down the transaction cost of remittance from the present cost of $27 per transaction to just $1 per transaction, he said. “What does the $1 N-Cash remittance mean to our country? Just think. If all 64 million remittance transactions last year had been sent at a cost of $1 each transaction, it would have cost the overseas Filipinos and their families only 64 million dollars instead of the $1.7 billion to send that money home," he said. “That would equate to a savings for our citizens of $1.663 billion," the senator added. - GMANews.TV