Vice President Jejomar Binay has urged overseas Filipino workers (OFWs) to patronize the Housing Development Mutual Fund, known more popularly as the Pag-IBIG Fund, which he described as an “ideal savings system for the ordinary Filipino worker.”
Binay, the government’s housing czar, issued the call during a dinner with the Filipino community in Lund, Sweden, last Wednesday.
“We need to build at least 3.6 million affordable units—or 360,000 units a year—over the next ten years. This is one area where, as HUDCC (Housing and Urban Development Coordinating Council) chair, I have consistently pushed for foreign investments to come in,” said Binay who heads the Pag-IBIG board.
“But to my pleasant surprise, the most enthusiastic response has been coming from our own OFWs themselves,” he said.
“They have been investing in the HDMF, or Pag-IBIG, and building their own homes at the best possible terms in the process,” Binay said.
He said the fund is now worth P280 billion, and has nine million members worldwide, at least one million of whom are OFWs.
“I am sure that all of you are doing everything to invest your money wisely for your future and for your loved ones in the Philippines,” Binay said.
“But you could have more options through Pag-IBIG. I trust you will allow Pag-IBIG to serve needs,” he said.
Monthly contributions to the fund earn dividends higher than the usual bank rates, Binay said.
The contributions are credited to the member’s account as savings, which are tax-free, government-guaranteed, and remain in the member’s name even if he or she transfers employment or gets unemployed.
The Pag-IBIG Fund in 2010, he said, declared P7.882 billion as dividends — equivalent to 71 percent of the fund’s net income — benefitting all of its members.
“Pag-IBIG members can avail themselves of short-term loans equivalent to 80 percent of their total savings to finance emergency needs, such as tuition, medical expenses, and others, he said.
Last year, the fund loaned over P40 billion to some 2.5 million members.
When Typhoon “Ondoy” struck the Philippines, Pag-IBIG extended some P14 billion in calamity loans to some 700,000 members, according to Binay.
Just recently, the fund provided economic relief to OFW members who were repatriated from conflict areas in the Middle East and North Africa in the form of early withdrawal of their accumulated savings or a six-month moratorium on payments of their multi-purpose or housing loans.
“Similarly, Pag-IBIG created a window to provide emergency loans to members who had fled Japan at the height of the earthquake-tsunami disaster,” he said.
The fund, Binay said, has accredited a number of reputable banks/agents and remittance companies in key cities abroad to facilitate access to remittance facilities.
Pag-IBIG members may borrow up to P3 million for housing. In 2010, some P41 billion was released for this purpose.
Some 300 families everyday benefit from this program.
The Pag-IBIG board has also approved a “good payor” incentives program for all housing loan borrowers who are up to date with their payments.
This is expected to benefit at least 76,000 members.
Recently, Pag-IBIG launched Pag-IBIG 2 or Pag-IBIG Saving Plus, which offers as much as 5 percent interest for a minimum investment of P500 a month.
This has a maturity period of five years, and terms are flexible.
Members may choose to do a one-time lump sum remittance, instead of monthly deposits, park it as savings, and wait for its maturity after five years.
By virtue of Republic Act 9679, otherwise known as the HDMF law of 2009, all OFWs and other individuals employed by foreign-based companies may now enjoy all the benefits enjoyed by the original members.