Manila: A government-run social pension office has offered a high-yielding special provident fund for overseas Filipino workers, which they could avail of with additional payment on top of their regular monthly contributions, for higher pension when they retire, or for emergency money when they need it, sources told Gulf News.
Starting July, the Social Security System (SSS) has offered four per cent annual interest rate for contributions made by OFWs to Flexi-Fund, to be applied on P200.00 (Dh16.67) or more (not less) than the amount that they contribute on top of their maximum monthly contribution of P1,560.00 (Dh 130) each. OFWs have the other option to pay monthly a minimum of P520 (Dh43.33) each for their SSS retirement plan.
Although OFWs who are already paying the maximum amount of monthly contribution (P1,560) are already qualified to join SSS’s Flexi-Fund, “they still have to enroll to make their participation in Flexi-Fund binding, at Philippine embassies and consulates where they are based abroad,” explained Francis Lazaro, junior program specialist of SSS that handles investments of OFWs.
The new interest rate offered to Flexi-Fund is one way for SSS to give back to the OFWs the earning that the
government agency is already receiving from its deposits and investment in commercial banks, explained Lazaro.
When SSS offered Flexi-fund to OFWs in 2001, investments were computed, starting 2004, on the earnings of 91-day Treasury bills.
“With higher guaranteed interest rates (that is offered to Flexi-Fund now), OFWs can further increase their retirement savings and benefit from prime rates obtained in short-term peso placements as against low interest rates offered in government auctions,” SSS President and Chief Executive Officer Emilio de Quiros, Jr. said.
“When we campaigned for investments for Flexi-Fund in an information caravan last year, we were surprised that we did not do a hard sell campaign (because of the response of the OFWs),” said Joy Villacorta, head of the OFWs department of the SSS.
“Our (social pension) programme is voluntary as far as OFWs are concerned. We rely on greater awareness of the additional funds that we offer to them,” said Villacorta, adding that SSS has technically enticed OFWs to become maximum payers when Flexi-Fund was offered to them starting 2001.
Since then, however, only 37,000 OFWs have enrolled in the Flexi-Fund program of SSS. Now, it has a combined equity of P312 million (Dh26 million).
SSS has about 740,000 registered OFW members, records showed.
There are nine million OFWs worldwide. They have been sending $20 billion to relatives in the Philippines every year.