A bill that requires the full disclosure of finance charges and other fees imposed by remittance agencies has been filed in the Senate
Senate Bill No. 2162 introduced by Senator Koko Pimentel III seeks to protect the remittances or money transfers of overseas Filipino workers (OFWs).
But at the same, the measure compels remittance agencies to adhere strictly to the terms and conditions of their money transfer.
“The measure compels remittance agencies to adhere strictly to the terms and conditions of their money transfer.”
“Over the years, there have been complaints that remittance agents or money transfer companies utilize unfair and deceptive trade practices such as using rates notably lower than the foreign currency exchange rates of Philippine banks, in effect concealing the real rate to most recipients,” Pimentel said.
“Hence, there is a need to mandate full disclosure and impose anti-price gouging rules to prevent these acts,” the legislator said in filing SB 2162, the proposed “Remittance Act.”
The lawmaker’s bill also imposes strict limitations in the rates that remittance agents and companies may use in money transfer transactions.
“The bill also imposes strict limitations in the rates that remittance agents and companies may use.”
One of the provisions of the bill compels all remittance agents and companies to be duly registered and meet all the requirements issued by the Bangko Sentral ng Pilipinas (BSP), Securities and Exchange Commission (SEC), Department of Trade and Industry (DTI) and the Bureau of Internal Revenue (BIR).
They’re also required to adhere to the reference exchange rate bulletin of the BSP and prohibited from substituting the Philippine Peso for the specified original currency without the express or written consent of the recipient.
In addition to standard paperwork, remittance agents and companies shall be required to include a waiver form for each transaction which shall contain the following information in clear and concise words:
- The specific exchange rate provided for that currency;
- Any and all additional fees being deducted from the original remittance;
- A signed acknowledgement that the recipient consents to the exchange from the original currency to Philippine Peso thereby forfeiting a percentage equivalent to the flat rate fee for the remittance service;
- Notice to senders and recipients that senders are generally not permitted to require that the money transfer be made in the original currency, except in specific countries where senders are given the option of specifying the money to be received in original currency form without any additional exchange fees being charged to the sender; and
- The list of countries, as determined by the BSP, which give the option to require that money transferred to be paid out to the recipient in the original currency sent.
Price gouging, charging unconscionably high prices or fees that are excessive compared to what the free market offers, of currency exchange rates has also been included among the punishable acts.
Violators will be meted out a prison term of a minimum of six years to a maximum of 10 years and a fine ranging from P200,000 to P1 million.