Due to fears of displacement and possible unemployment as the effects of the global financial slowdown continue to unfold, families who rely on remittances sent home by a family member working abroad are learning to save or invest.
In a recent survey conducted by the Bangko Sentral ng Pilipinas (BSP), 44.8 percent of 524 respondent families which rely on remittances in the fourth quarter 2009 allotted portions of remittances to savings.
The ratio was 39.9 percent during the third quarter.
The central bank said the percentage has significantly increased from only 7.2 percent in the first quarter of 2007.
Households using remittances for investment also went up from 2.3 percent in the first quarter of 2007 to 7.1 percent in Q4 2009.
But the ratio is slightly lower than the 7.6 percent registered in the third quarter.
“OFW households utilize their remittances primarily for savings, food, education, medical expenses and debt payments in Q4 2009,” BSP said.
The survey said 95.2 percent of respondents spent remittances on food and other household needs.
Of the households, 65.8 percent used remittances for education expenses, 62.2 percent for medical expenses, and 49.2 percent for debt payments.
The percentage of OFW households that utilized remittances to purchase consumer durables and motor vehicles was broadly steady at 26.0 percent and 6.7 percent, respectively from 26.5 percent and 6.8 percent in Q3 2009.
Those that apportioned part of their remittances for amortization or full payment for houses dropped to 10.5 percent from 12.1 percent in the previous quarter.
BSP deputy governor Diwa Guinigundo earlier said the results of the survey “reflect the uncertainties in the global economy.”
“Most OF families are concerned that the global economic slowdown that is resulting to recession in most of the developed economies may result to displacement of OFWs,” Guinigundo said.
But the BSP said the fears might be exaggerated.
It said remittance flows were shored up by the continued strong global demand for professional and skilled Filipino workers and the wider access of overseas workers and their beneficiaries to a broader array of financial products and services.
BSP said these factors support the optimistic outlook for sustained growth in remittances through the rest of 2009.
Remittances from overseas Filipinos coursed through banks rose significantly to $1.4 billion in September 2009, posting a year-on-year increment of 8.6 percent.
As a result, cumulative remittances for the nine-month period increased by 4.2 percent to reach $12.8 billion.
By : Jimmy Calapati -Malaya.com.ph