One of the problems that our fellow Overseas Filipino Workers face before they go to another country to work is the money that they will leave to their family. Since preparing for the documents needed also requires money, a lot of our OFWs are faced in a dreaded situation: “Where can I get the money that my family needs before I receive my first salary?”

Because of the situation, most OFWs get their hands on lending businesses that charge sky-high interests. So before they receive their first salary from working overseas, it is already scheduled for payments of the loans they incur in the Philippines. Nothing is left for their family anymore.

Luckily, the Overseas Workers Welfare Administration (OWWA) in partnership with Land Bank of the Philippines (LBP) and the Development Bank of the Philippines (DBP) formed the OFW-Enterprise Development Loan Program. This project aims to lend money to our modern day heroes to start a business in the Philippines.

How Does it Work?

The OFW-Enterprise Development Loan Program is a two-component package: the Enterprise Development Interventions and the Loan Facility.

The EDT aims to empower OFWs on how to manage a business. It will be the best opportunity to ask questions about a business loan. It aims to help OFWs and their families in establishing viable business enterprises that can provide them with a steady income and to provide employment opportunities for people in their community.

For EDT, the loanable amount for a qualified individual borrower is from PHP 100,000 up to a maximum of PHP 2 million. For group borrowers, they can borrow up to a maximum of PHP 5 million. It also has a fixed interest rate of 7.5 percent per year.

The loan can be used as a working capital or for acquiring fixed assets to be used for business operations. This program also requires that the proposed project should already have a ready market and should also generate a monthly income of at least PHP 10,000.

Each individual or group borrowers can choose a short-term loan that they can pay within a year or a long-term loan which is payable based on the cash flow but not exceeding to seven years, including the maximum two-year grace period on the capital.

Through the assistance of DTI, OFWs can also have access to training and technical support in starting a business. They also have opportunities to attend events like exhibitions, conferences, caravans, symposium, and other activities initiated by DTI as well as other private sectors.

How to Avail It?

Who is Eligible for the Loan?

• An OFW who is a certified OWWA member, active or inactive, and has completed the Enhanced Entrepreneurial Development Training.
• OFWs who are working abroad may be presented by the following members of his family, with Special Power of Attorney authenticated by a consul:
  • By parents who are not more than sixty (60) years old upon the maturity of the loan or by children who are at least eighteen years old at the time of the loan availment if the OFW is single, widow or widower, separated-in-fact.
  • By the legal spouse if the OFW is married.
• If the OFW or his or her Attorney-in-fact is more than 60 years old upon the loan maturity, a co-maker of the loan is required. The co-maker can be his or her siblings or the children of legal age.
• OFW returnees can also avail of the loan program within three years from the date of arrival in the Philippines, except in cases where the OFW-applicant has an on-going business prior to the time of application.
• Only one OFW per family, within the first degree of consanguinity or affinity, shall be eligible to apply under the program.
• Group of OFWs who formed themselves into a business entity, either as a partnership, corporations or cooperatives, and has at least 3 years track record of profitable operations, provided that all partners, stockholders, directors, officers or members are OFWs who have been certified as OWWA members and have completed the EEDT.

What are the Eligible Businesses?

• Franchising business
• Contract tie-up with the top 1000 corporations
• Agri and non-agri production and manufacturing with identified market linkage and raw material sources
• Construction or rental business
• Service or trading business
• Transport service
• Other viable projects, existing or new, that should generate a net cash flow sufficient to pay the projected amortization of the loan

Project Cost Sharing

• Borrower’s Equity is at least 20% of the total project cost.
• Maximum loanable amount is limited to 80% of the total project cost.

Loan Security and Collateral

The object of the financing shall be required as a loan security as well as other documents that may be required by LBP/DBP in relation to business approval such as:

• Torrens Certificate of Title, Condominium Certificate of Title, Tax Declaration, and plans on mortgageable assets of the borrower.
• Any loan security acceptable to the bank such as OR/CR for Chattel Mortgage, Lease Rental Contract, Receivables and other Contract Agreements for execution of the Deed of Assignment, Purchase Order, etc).

Steps to Avail an OFW-EDLP Loan

Step 1: Verification of OWWA Registration

For OFWs outside the Philippines

1. Email the Welfare Officer of the Embassy that covers your country of work about the OFW Reintegration Program.

2. The Welfare Officer will verify your registration in OWWA as an OFW.

3. Upon verification, the Welfare Officer in the Embassy will refer the OFW to an OWWA office in the Philippines.

4. Once in the Philippines, the OFW needs to visit the OWWA office to get a certification.

5. This certification from OWWA should be presented to Landbank.

For OFWs in the Philippines

1. Visit the nearest OWWA office to verify your eligibility to the program.

2. If the OFW is eligible, a certification of membership will be issued and needs to be presented to Landbank for assessment.

Step 2: Enterprise Development Training

An eligible OFW will be advised to personally attend the Enterprise Development Training conducted by OWWA, DTI, and Landbank.

The OFW must present this certificate of attendance to Landbank as part of the loan application requirement.

Step 3: Prepare the Business Plan and Other Requirements.

• OWWA certification that the borrower is a bonafide overseas worker and has completed EDT
• Two valid IDs with signature
• Duly filled-out Application Form
• Statement of Assets and Liabilities
• Barangay Certification of residency 
• Proof of Billing address
• Sketch of place of residence
• A business plan for the specific project or business
• If OFW has existing business prior to loan:
  • Contract Growing Agreement, Purchase Order or Service Contract
  • Certificate of Registration with DTI
  • Mayor’s permit
  • Income tax return (last 3 years)
  • Financial statements (last 3 years, BIR-filed)
  • Latest Interim Financial Statement, if applicable

Step 4: Submission of Requirements, Review, and Inspection

• Submit all of your requirements to Landbank for review.
• Inspection of your business (if it is already existing) will be done.
• Loan evaluation, packaging, and approval will be completed within 45 working days upon the receipt of the complete loan requirements.

Step 5: Approval of the Loan

If the loan is approved, Landbank will release the funds to the OFW.