Pag-IBIG expands mandatory coverage to include OFWs

MANILA, Philippines—The government housing finance institution has expanded its mandatory coverage to include Filipino workers from formal and informal sectors here and abroad, it was learned Monday.

The Home Development Mutual Fund (HDMF or Pag-IBIG Fund) made the announcement in a press statement issued Monday, after its chief executive officer Jaime Fabiaña met with overseas Filipino workers in Hong Kong to inform them of the passage of Republic Act 9679 (or the Home Development Mutual Fund Law of 2009), which took effect last month.

Membership of OFWs used to be voluntary under the old Pag-IBIG Overseas Program, with terms of five, 10, 15, and 20 years.

However, OFWs in the former British colony did not welcome this development. Members of Gabriela-Hong Kong opposed the mandatory Pag-IBIG coverage, calling it as another government scheme to try and “milk” them of their money.

The OFWs’ opposition to the universal coverage forced Fabiaña to tell them that they won’t be forced to become Pag-IBIG members, said Cynthia Abdon-Tellez, chairperson of Gabriela-Hong Kong, in a statement. She said her group will hold a rally Sunday, February 7, to call for the scrapping of this provision in the law.

Nevertheless, Fabiaña still tried to sell the idea to OFWs. “Be a Pag-IBIG member and secure a bright future for yourself. Your savings with the Fund earn double and even triple. These savings are guaranteed by the government and earn tax-free dividends. More importantly, as a member you have access to benefits no banks can give such as the lowest interest housing loans, fast salary loans and reliable calamity loans,” he said.

With the mandatory coverage, OFWs can enjoy the various benefits of being a member which include:

* Savings. Members’ contributions are credited to their savings or the total accumulated value that earn dividends and fully guaranteed by the national government. In 2009,
Pag-IBIG declared tax-free dividends amounting to P8.5 billion with a dividend rate of 5 percent.

“At this dividend rate, an OFW member will generate savings amounting to P40,753 if he contributes P100 monthly for 20 years; P81,507 if he contributes P200; and P203,768 at P500 a month. The bigger the contribution, the bigger the savings,” Fabiana explained.

He assured that Pag-IBIG savings are portable, meaning, “these remain in the name of a member even if he transfers employers, works abroad, or becomes self-employed or even unemployed.”

* Short-term loans. OFW-members can also avail of short-term loans that will help address their immediate financial needs such as payment for tuition fees, hospital bills, appliance purchases, minor home repairs, and even for small business capital.

* Housing loan. A member of good standing is eligible to avail of a home financing loan that has an interest rate of as low as 6 percent to 11.5 percent payable in 30 years. The maximum loan amount is P3 million. The loan can be used for the purchase of a fully developed lot within a residential area not exceeding 1,000 square meters, purchase of a residential house and lot, townhouse or condominium unit, construction or completion of a residential unit on a lot owned by the member, home improvement and refinancing of an existing loan.

Fabiana said that in 2009, Pag-IBIG extended a total of P9.6 billion in housing loans to their OFW members which financed 12,233 housing units. “No other financial institution, government or private, has extended this much for OFWs’ housing,” he stressed.

He attributed the 68-percent increase in housing loan availment of OFWs in 2009 to the housing reforms initiated by Pag-IBIG’s board chairman Vice President Noli “Kabayan” De Castro, primarily the low interest rates and long repayment period, which makes it the most affordable home lending program in the country today.

To register for membership and for other inquiries, OFWs can call 724.4244 or visit the Pag-IBIG office located at the 6F, Justine Building, Gil Puyat Avenue, Makati City (beside Land Bank). They can also register through the Pag-IBIG satellite offices at the Philippine Overseas Employment Agency (POEA) and the Ninoy Aquino International Airport (NAIA) or coordinate with the Pag-IBIG information officers who conduct the Pre-Departure Orientation Seminar for OFWs. –Veronica Uy, INQUIRER.net