(Some things you just can’t shake off like the rising peso and climbing oil prices. The sooner Filipinos accept that, the better. Photo from AFP)
Sometimes, the most effective solutions to complex problems are the simplest. Like transparency, for instance. One of the simplest ways to reduce corruption is to require government offices to regularly report audited figures on the unit cost of everything they spend public money on. As you all know, information is a currency recognized in all countries and it levels the playing field like nothing else can.
While doing research on fund transfers for an article I was writing, I was so frustrated to find so many banks holding on to remittance charges, breakdown of costs and delivery time as if these were state secrets. Some even said these were proprietary information. Duh.
The Bangko Sentral ng Pilipinas’ move to compel banks to make these data available to anyone is a good move, but I hope no one shoots me for asking, “What took so long?” I mean, no one had to revise a law or hire a rocket scientist for something as simple as a policy on transparency, right?
Better now than later. This policy should heighten the competition even more, especially as new technology is being developed all the time to make remittances very affordable.
An Indian company for example, aurionPro, has claimed it can bring down banks’ cost for each transaction to as low as $1 for real-time delivery, regardless of where the money is coming from. Their technology will even allow an OFW to be serviced from his home or office (the park nearby, if necessary) through a handheld device that a bank staff can bring to him. Mind-boggling isn’t it? Naturally, banks will have to add a few more dollars to that cost, but hey, a dollar for real-time money transfer whether you’re in HongKong or North America ain’t bad.
Discussion on the peso-dollar exchange rate is deepening, as the Senate orders a probe on its appreciation and former labor secretary Patricia Sto. Tomas and now DBP chairman backs a proposal to create a special exchange rate for OFW remittances over a specific period.
As this developed, Energy Secretary Angelo Reyes went over to the Senate today and became an instant sensation when he announced he would look into possible price fixing among oil companies. Here you are worried that gas prices will hit P50 by yearend, only to be told that there could be collusion among oil companies to bring the prices even higher?
I understand why he became an instant hit with transport groups and some senators, but unfortunately, the good secretary cannot hide the fact that oil prices are going up everywhere. No amount of price-fixing busting will bring oil prices down in this country. We all have to deal with the rising oil prices one way or another. Just like the peso-dollar rate. There are some things you just can’t shake off. I know these are tough, but the sooner we all accept that, the better.
November 21st, 2007 at 3:16 am
Salve, please delete the previous one.
Here’s what I discovered recently. as I mentioned before, we send money through remittance centers. We pay QR15 (roughly $4) for any amount of remittance and it can be delivered door to door or through a bank. Most remittance centers are affiliated with EPCI (now BDO) Express Padala. I believe other banks such as BPI are also affiliated with some remittance centers. Anyways, There are two remittance centers to which I send my money - both are affiliated with BDO EPCI. The advantage is if you have BDO EPCI account in the Phils, money will be credited within 24 hours.
A few weeks ago, I sent money and for the first time, I requested for proof of payment to make sure it was credited to the beneficiary’s account. I found out that they add P100 to the amount sent. I’d like to believe it is the handling fee. Based on the document I got, the money was received by BDO EPCI then credited to the BDO account.
Now, the question is does BDO get 100% of P100 as handling charge? What if it’s credited to other banks or delivered door to door? Do other banks get a share? I don’t intend to find the answer. I’m just sharing my recent discovery since it is related to the post.
November 21st, 2007 at 3:12 am
Here’s another discovery. The cost of sending a remittance is the same whether if you want it to be credited in Peso or $ account.
For some reasons, if you want to send it in a $ account, the bank deducts anywhere from $3 to $6, depending on which bank you are using. Banks do not explain this deduction but I think it’s some kind of comission.
One time, I sent money to my $ account at HSBC Phils. HSBC sent me a telegraphic transfer notice with the trace of how money travelled from one bank to another. From the remittance center, it was sent to BDO then BDO transferred it to Citibank Juan Luna Branch then to HSBC. Along the way, the money was deducted $2.75 when it reached citibank. I am not sure where the deduction happened and then HSBC got a $2 commission. I am also not sure if these deductions are fixed.
I lost $4.75 but it’s still cheaper than sending it HSBC to HSBC. TT through banks cost between $15 to $20. Although if it’s HSBC to HSBC, HSBC Phils will not get a commission anymore.
I think money sent via TT and via remittance centers are treated differently. TT cost more and the receving bank normally gets a commission. This is true even for local TT. I’ve tried local TT before and both the sending and receiving bank deducted huge fees.
November 21st, 2007 at 1:30 am
Salve-
Can you or maybe you can find someone to explain why despite the peso-dollar rate increase, the oil prices still shoot up?
Isn’t it that these oil companies are “importing” oil and paying in USD? Or is this what Senator Reyes is hinting?
Peter