Remittance beneficiaries now smarter with money

FAMILIES receiving remittances from migrants are increasingly becoming wiser with their money, with savings and investments continuing to increase, results of a recent survey showed.

Nearly a decade ago, barely one in 10 families supported by overseas Filipino workers (OFW) set aside money for rainy days. In a survey conducted last April, half of OFWs’ families were saving their relatives’ hard-earned cash.

“There was a further increase in proportion of families intending to save,” Bangko Sentral ng Pilipinas (BSP) Deputy Governor Diwa C. Guinigundo said.

A survey by the BSP showed 49.7 percent of OFW dependents intend to set aside money for savings. This was an improvement over the 39.4 percent in the previous survey, which was conducted in February.

Meanwhile, those who want to set aside money for investments increased to 6.7 percent of all OFWs surveyed. This was an improvement from the 5.1 percent the previous survey.

The savings and investment rates for OFW families were significant improvements over the previous decade. When the survey was first done in 2007, just 7.2 percent of OFW families intended to save money, while 2.3 percent were planning on investing.

Other major spending priorities for OFWs were for food and other household needs (97.2 percent), education (71 percent), medical expenses (63.3 percent) and debt payments (43.1 percent).

Remittances are one of the key pillars that prop up the Philippine economy. Last year, cash transfers from migrant workers rose 5.9 percent to a record high of $24.3 billion, accounting for nearly a tenth of gross domestic product.

This year, the BSP expects remittances to rise by 5 percent to a new record high of $25.6 billion.

In April, remittances grew by 5.1 percent year-on-year to $2.01 billion, slowing down from the 11.3-percent expansion recorded a month earlier. The total for the four months stood at $7.81 billion, up 5.4 percent year-on-year.