Wednesday, April 20, 2011

Their own boss with P50,000 OWWA loans

Filed Under: Housing Mortgage & Loans
MANILA, Philippines—Some 300 overseas Filipino workers displaced by the global financial crisis have borrowed up to P50,000 each or a total of P15 million since the Overseas Workers Welfare Administration offered the low-interest, uncollateralized livelihood loans in January 2009.

Among the recent borrowers were Eleanor E. Malacas, 23, of Dagupan, Tondo, and Joyce Ann D. Aucena, 33, of Tunasan, San Pedro, Laguna.

As a condition for the soft loans, the money should be used by borrowers as capital for livelihood projects. Malacas and Aucena would use theirs as capital to put up a carinderia (small eatery) and start an FX transport operation, respectively.

Malacas, Aucena, and 48 others received their checks at a simple turnover ceremony at the Quezon City Hall. Another set of 20 workers received their checks last Friday in Dipolog, Zamboanga.

Malacas felt confident that she would recover her investment and make money with her carinderia. Part of her parents’ house would make way for the eatery, saving on rent. Food traffic is assured because the carinderia would be offering to customers on a busy street in Tutuban. Her mother, who already sells fish balls, will help in cooking and running the store.

Terminated in Taiwan

The P50,000-loan will pay for a refrigerator, rice cooker, food ingredients, and minor carpentry work.

“The loan terms are so liberal,” she said.

At a Taiwan electronics factory, Malacas worked eight months of a two-year contract as a production worker. The company wasn’t making good in its business and was pre-terminating factory workers by batches. All pre-terminated workers were entitled to separation pay based on a formula. Her plane fare was paid for by her recruitment company.

She settled the balance of a pre-departure loan before coming home. She had borrowed P40,000 that would be repaid as P50,000 over one year. She paid NT$3,000 per month at a 7-11 branch in Taiwan. She arrived home mid-January 2009.

How to run a business

Her mother told her about the OWWA loans from a TV news report.

A few days after arrival, she applied for the OWWA loan and took a free, three-day course on how to run a business. On the first day, she was taught that she should not run down the capital by paying for personal expenses, and that she should pay herself a reasonable salary. The second and third days were spent learning from a chef how to cook two of 39 items in a lunch menu. The cost of raw materials and training materials for the course were all paid for by the Department of Labor and Employment.

After Malacas completed the business literacy course, OWWA turned over her loan check of P50,000 last Friday at a jobs fair at the Quezon City Hall.

Parking rights

Aucena, 33, will use her P50,000 to pay for parking rights to load and unload passengers at a GT (garage-terminal) Express terminal at the Fiesta mall terminal in Alabang.

She drives commuters in her van from 4 a.m. to 12.30 a.m. the following day between Tunasan in San Pedro and the Festival Mall in Alabang. She makes at least 25 trips a day. She takes a rest every other day; her brother-in-law takes over the driving.

“I lacked P50,000 to park my FX at a GT Express terminal at Festival Mall in Alabang,” she said. She had paid a separate P50,000 earlier for parking rights at the Tunasan end. She used her savings from her Taiwan work.

“I don’t want to borrow again from my father,” she said.

“The membership associations assist drivers if we have problems,” she said. “They also assist transport operators to obtain permits and routes from the Land Transportation and Regulatory Franchising Board to operate a transport business.”

She learned about the OWWA loans in Taiwan from text messages from her friends who have returned earlier.

“Magbibigay ng pagkakataon ang perang ito (This money would give opportunities),” she said, referring to the OWWA check. “The terms are very liberal. Five percent per year, right?”

She did not have to undergo a business literacy course because she had already been in transport operations when she applied.

Second contract not completed

Aucena was working on her second contract in Taiwan when her company was hit by low export orders. She was an operator testing finished IC wafers at an electronics company. Her first contract was for five years plus an extension of two years. She returned on a second contract with a possible extension of another year. She did not complete the second contract.

“In 2008, we started feeling that our days at work were numbered,” she said. “Before, overtime was plenty. We worked seven days a week, 12 hours a day. Then the company reduced work days and hours. Overtime pay got hit; on our own, we decided it was time to go. After all, we were just paying the broker and the rent.”

The company paid for her plane fare home.

Livelihood support fund

According to OWWA Administrator Carmelita Dimzon, the soft loans were part of the Filipino Expatriate Livelihood Support Fund, a program created by President Gloria Macapagal-Arroyo through a directive to Labor Secretary Marianito Roque, to help expatriates whose overseas work contracts were abruptly shortened by the global financial crisis.

The OWWA board of trustees approved the guidelines that provided for easy and hassle-free access of the loans by GFC-displaced OFWs nationwide. OFWs displaced from October 2008 may avail themselves of the FELSF loans from OWWA.

Roque has directed all regional welfare offices to release loans without delay to qualified borrowers.

No collateral

The loans are payable in two years at five percent per annum. Payments start only after a grace period of 90 days without interest. No collateral is required.

Dimzon said that OWWA is ready to lend more from its revolving fund of P100 million.

“The FELSF supports the OFWs in income generation even as they reintegrate themselves at home,” Dimzon said. “They need to remain productive and sustain their families.”

Pajarillo is OWWA’s media adviser. He may be reached at 0922-2443577 or

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