Bernadine Racoma
If you’re one of the hard working overseas Filipino workers, wouldn’t you welcome the chance to start a good life in your home country? This is the promise of the P2-billion Reintegration Program for OFWs. Sounds good, doesn’t it?
An OFW loan through OWWA’s reintegration program is a legitimate means to help provide capital to OFWs who want to be entrepreneurs.
An OFW loan applicant must meet many requirements. The strict process is not meant to make life difficult for the borrower. It is intended to ensure that the loan will only be used for a legitimate business purpose and that the applicant will be able to repay the loan.
Things to do
An active OWWA member applying for a business loan through the reintegration program must complete all the documentary requirements prior to loan processing. These requirements are the same whenever you want to start a business, even if you do not apply for an OFW loan:
The DOLE website lists all the requirements, as follows:
- OWWA certification proving the borrower is an active member who has finished the required Enterprise Development Training (EDT).
- A formal business plan or contract growing, purchase order or service contract
- DTI business registration certificate
- Biodata
- Copy of income tax return (ITR) for the last three years
- Copy of financial statements for the last three years files with the BIR
- Applicable interim financial statement (latest)
- Assets and liabilities statement
- Business permit from mayor’s office
An active OWWA member and certified OFW still located overseas should first get the membership certification from OWWA. Verify your status through the Welfare Officer of the Philippine Embassy in the area where you are currently employed. Once you are back in the Philippines, visit the OWWA office to retrieve your membership certification.
Submit all the required documents to the Landbank to initiate your OWWA loan application. If you have to go back overseas and cannot follow up the loan application, execute a Special Power of Attorney and authorize your spouse or a trusted immediate member of your family who is of legal age to proceed with the loan application on your behalf.
If you do not have any property under your name, use any of these:
- Proof of receivables
- CR/OR of vehicle
- Lease rental contract
- Deed of assignment, purchase order and other credible contract agreements
- Have a co-borrower of good credit standing
Again, the DOLE website states that the loanable amount is 80% of the total cost of the business project, which can be between P300,000 and P2,000,000, with a fixed annual interest rate of 7.5%. The short-term loan should be paid within a year and up to 5 years plus 2 years grace period for long-term loans.
Other keys things to consider: borrower must have a ready market for the product or service, with a projected monthly minimum income of P10,000.
The loan requirements might be strict but it is to ensure that the funds will be sustained to help other OFW loan applicants. It can only be used to start a business with a ready market. Moreover, you can consider other OFW loans Philippines options.
