A measure seeking to provide interest-free loan assistance to aspiring Overseas Filipino Workers (OFWs) to cover their pre-employment and pre-departure requirements was filed by Senate Committee on Foreign Relations Chairman Sen. Erwin Tulfo.
In his proposed Senate Bill No. 1696, or the “OFW Pre-Employment Loan Assistance Act,” Sen. Erwin said that qualified OFWs with valid overseas employment contracts may access loans of up to ₱100,000. Too, the bill mandates that first-time OFWs be given priority access to the program, alongside a mandatory financial literacy orientation, before they depart for work abroad.
“OFWs contribute billions of dollars in remittances. They significantly boost not only our economy but also our national morale; yet, they are often left to strive alone to achieve their dreams. In our Action Center, we frequently encounter OFWs who have to scramble for funds—often incurring debts from loan sharks—just to settle their pre-departure fees,” Senator Erwin added.
Common pre-employment expenses identified in the bill include placement and processing fees, medical and psychological examinations, training and skills assessment, airfare, passports, visas, and work permits. If enacted into law, the OFW Pre-Employment Loan Assistance Program will be administered by the Department of Migrant Workers (DMW), in coordination with the Overseas Workers Welfare Administration (OWWA).
Tulfo explained that under the proposed guidelines, the loan shall remain interest-free during the first year of repayment and should this period lapse, any interest imposed shall not exceed prevailing government lending rates, with payments to be made through authorized bank accounts.
To ensure accountability, the bill requires at least one member of the OFW’s immediate family to participate as a co-borrower.
Furthermore, first-time OFWs are set to receive specialized support through prioritized processing, an extended repayment period of up to 18 months, and mandatory access to free debt management programs.
“It has become a common story among our OFWs that despite earning well abroad, they remain mired in debt because they lack the necessary training in financial management,” Tulfo stated, adding: “We want our kababayans, who sacrifice being away from their families, to build a better life that lasts a lifetime. Our ultimate aspiration is that their children, and the generations after them, will no longer be forced to work abroad.”
