Saturday, April 28, 2007

Banks keep remittance costs steady


By Des Ferriols
The Philippine Star 03/06/2007

 

Despite huge outlays for technology and service upgrades, the Bangko Sentral ng Pilipinas (BSP) said banks were able to keep remittance costs steady in 2006.

The BSP conducted a survey of top Philippine remitting banks and the results indicate that remittance charges in 2006 have not changed the prices in 2005. compared to  

According to BSP Governor Amando M. Tetangco Jr., remittance costs had gone down dramatically in 2005 compared with 2000 levels and banks have generally been able to keep these rates steady last year.

"The banks further noted that service fees could have been higher because of investments in infrastructure and automation, as well as continuing enhancement of products and services," Tetangco said.

However, Tetangco said remittance charges were kept steady because the costs of building the infrastructure and enhancing services were not passed on to the banks' customers.

According to Tetangco, overseas Filipino workers also benefited from the improvements in the country's payments and settlements systems, such as the full interconnection of the three major automated teller machine (ATM) networks.

"As bank clients, OFWs likewise benefited from the approval of alternative mechanisms for sending applications for remittances, money, such as SMS-based " he said.

The interconnection of the three networks, Tetangco said, reduced the cost of transactions since it eliminated fees associated with the use of international "switch" to connect the three networks.

Tetangco said the BSP's grant of authority for rural banks to operate as foreign currency deposit units (FCDUs) is expected to promote the efficient and speedy transfer of funds to beneficiaries in areas which are mainly served by rural banks.

"This would also give OFWs the option to keep their savings in the form of FCDs exchanging their earnings for pesos, instead of immediately " he said.

According to Tetangco, the BSP was also drafting a circular that would standardize identification requirements of banks to customers in order to facilitate access to the services of financial institutions in remote areas while ensuring compliance with Anti-Money Laundering Act (AMLA) regulations.

Tetangco said the BSP was undertaking further financial literacy campaigns (FLCs) to help channel remittances to development activities and inform OFWs alternative opportunities for their remittances, such as placements in financial investments in business ventures. instruments and  

"The BSP recognizes the valuable contribution of OFWs in expanding the foreign exchange available for meeting the economy's requirements," Tetangco said.

 

http://www.philstar.com/philstar/NEWS200703060709.htm

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