Communication of OFW financial literacy programs not systematic enough - study

A recent study conducted by the Philippine Institute for Development Studies (PIDS) revealed that the government's financial literacy initiatives are not effectively reaching overseas Filipino workers (OFWs).

The PIDS study on the long-term effects of labor migration in the Philippines found ''the communication of government initiatives to improve the financial literacy and stability of OFWs has, however, not been systematic enough to make a solid impact.''

“Results of primary data collected from interviews with select OFWs and their family members suggest that young OFWs dream of retiring early but may not be provided systematic support for financial literacy,” the study, published in December 2023, said.

According to the PIDS study, remittances from OFWs represent at least 10% of the Philippines’ gross domestic product (GDP).

Researchers said 47.4% of the remittances were allocated for consumption, while 24.8% were for savings. Around 12.6% were reserved for investment in properties, business ventures, and financial instruments.

Among the government’s financial literacy programs are the PiTaKa or Pinansyal na Talino at Kaalaman of the Bangko Sentral ng Pilipinas, which promotes financial literacy and easy access to financial information among OFWs, including the conduct of info sessions on Personal Equity and Retirement Account (PERA).

The Overseas Filipino Bank (OFBank), a subsidiary of Land Bank of the Philippines, was also designed to cater to the financial needs of OFWs, with its role centered on providing banking services for OFWs.

“By empowering OFWs with the knowledge and tools to manage their finances responsibly and to obtain more competencies, especially in this digital age, we can help them achieve their aspirations of becoming successful entrepreneurs, financially secure and future-proofed individuals,” the study said.

“This holistic approach to reintegration support is not only an investment in their individual well-being but also a part of the country’s paying back to these modern-day heroes for their contributions to the Philippines' continued economic growth and prosperity,” it added.

According to the Philippine Statistics Authority, there were 1.96 million OFWs during the April–September 2022 period.

In 2022, the top five destinations for OFWs were Asia (80.8%), Europe (9.0%), North and South America (6.3%), Australia (2.9%), and Africa (1.0%). – VBL, GMA Integrated News