For many years, Filipinos have been going out of the country as Overseas Filipino Workers (OFW) in other countries. Some have struck gold, even settled as migrants. But most have to settle for little to no savings, leaving them with little or even zero budget to start their own business ventures back here in the country.
The Overseas Workers Welfare Administration (OWWA) sees to it that this can be remedied. They offer loans for qualified applicants once they meet specific qualifications.
What to know about the OWWA loan
Seeking to address financial needs of OFWs who are not yet financially-able, OWWA provides various loan programs to its members who are qualified to avail of them. These can be availed by the OFWs themselves, or their immediate family members.
The OWWA provides numerous loan programs. Among these is the Collateral Loan Window which is under the OWWA-National Livelihood Support Fund (NLSF) Livelihood and Development Program, perfect for any business-related ventures the OFW applicant has in mind.
Interested individuals and even groups can avail of these loans provided they meet some requirements set by the OWWA. They can borrow a maximum amount of P200,000.00 and P100,000.00 respectively. The purpose of their loan, however, should fall under any of the following:
• Purchasing retail commodities or raw materials
• Machines or equipment procurement
• Construction or renovation of their business establishments
OWWA also offers Enterprise Development and Loan Program for OFWs to start their business. This is a joint program by the OWWA together with the Department of Trade and Industries (DTI). Applicants can avail of loans starting from P100,000 up to 2 million pesos. Provided, still, that they pass evaluations.
What are needed to avail of these loans?
Application forms for loans are readily available at any OWWA regional office. Applicants for loans should also prepare and secure the following documents for processing of their loan application.
Individual borrowers should have the following:
1. Any of these that prove their OWWA contribution: POEA-attested employment certificate; passport with POEA-LAC stamp; E-Card; or OWWA information sheet
2. Their business plan
3. Financial Statement (if the applicant already has a business)
4. Business Permit, obtainable through their respective city or municipal halls
5. Other collateral papers
In the case of immediate family members applying, they must submit the following: Marriage Contract and Consent, if the borrower is a spouse of an OFW; Birth Certificate, and Authorization Letter for single OFWs.
Group borrowers can also apply for OWWA loans, provided they submit the following:
1. The group’s officers should submit a proof of their OWWA contribution similar to above
2. Their businesses’ feasibility study
3. Financial Statement (if they already have an existing business)
4. Ownership titles or Collateral papers
5. For non-collateral loan window, they should include and submit a promissory note
6. The applying partnerships or corporations should be a registered member of the Securities and Exchange Commission (SEC); Cooperative Development Authority (CDA) for cooperatives; and Department of Labor and Employment (DOLE) for associations.
Applicants must remember to bring the accomplished application form with a 2×2 picture, and a sketch of their residences and/or business sites complete with routes to get there.
The loan applications will be processed in any OWWA regional offices located in Luzon, Visayas, and Mindanao.
Application Process for a OWWA Loan
Now that you know what an OWWA loan is, how it works and how to avail of it, what business is allowed and covered by the loan, and all the necessary requirements for the loan application processing, it is time to know how the application procedure will run.
Basically, the OWWA loan application has four steps:
Step 1: Applicants must attend and complete the Enterprise Development Training (EDT). This is basically a seminar conducted by the OWWA, the DTI, and the Landbank of the Philippines. Applicants will learn to understand business ventures, and necessary qualities needed by the participants in going through with their business. The EDT can also help draft, streamline and polish the participants’ business plans.
Step 2: Prepare the pre-processing requirements needed for processing of your loan application. This includes all the requirements mentioned above, and which will also include proof of OWWA membership, Certificate of Attendance from the EDT, and two (2) valid IDs, among others.
You can also double-check and know the detailed list of requirement you need to prepare before submitting your loan application, should there be any additional papers needed for the application.
You have to make sure that all the requirements are complete. This will make the processing of your loan application easier and faster. The requirements will then be submitted either to the OWWA Main Office, or regional offices, whichever is more convenient for you to go to for follow-up processes.
Step 3: The Business Plan will be submitted to the Land Bank of the Philippines, upon certification and endorsement of OWWA. At this point, the bank will evaluate your project proposal based on the borrower’s credit worthiness and project viability. Also, the Land Bank will package the loan application based on their credit facilities proposal.
Step 4: Loan evaluation, packaging, and approval. This will take 45 days upon receipt of loan requirements. This is the reason why it is important that you prepare ALL the necessary documents when applying for an OWWA Loan.
Keep in mind though that attending the EDT, as well as completing, securing and submitting all the requirements, is not a sure fire guarantee for automatic loan approval. After all, credit institutions follow certain guidelines in approving every loan application. As long as you can show the viability of your proposed business and prove your credit worthiness, the higher the chances that your loan application will be approved.