7 Things About The Philippines’ Remittance Economy and How You Can Make a Difference

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1. Over 20% of all families in the Philippines depend on cash from relatives working abroad in hospitals, ships, construction sites and households.

As of last count over 13 million Filipinos live abroad. This number is not going to get lower. Filipino workers are wanted all over the world because of their fluency in English, they are well-educated, and they are good natured.

And Filipinos want to work overseas. It may be more fun in the Philippines, but the pay and prospects are better overseas. In many cases, even if a similar job is available in the Philippines, a Filipino will choose the job that requires them to go aboard.

Because of this …

2. Total remittance from overseas in 2013 was US $22 billion.

And from January to September 2014, the amount was US $17.6 billion. Based on my rudimentary math, the projected overseas remittance in 2014 will be US $23.5 billion. And …

3.This remittance money makes up about 13% of the Philippines’ GDP.

And that’s just what’s happening overseas. This does not take into account the money from skilled and unskilled workers in Manila sent to their families in the provinces …

4. Total remittance within the Philippines in 2013 was US $36 billion.

That is the official figure; however, there is an additional estimated US $35 billion in cash that passes between the providers and their families in provinces. This additional figure is unofficial because there are no records for these transactions: it’s all cash!

And it’s all cash, because …

5. Over 70 million people in the Philippines are unbanked.

Meaning these people do not have a bank account. Also means that these same people do not have any access to credit (i.e. credit cards).

Two knock-on effects are (1) the cost of remitting money costs more; and (2) no credit means it becomes difficult to buy a house, start a business, or send children to school.

I also think there is a 3rd knock-on effect …

6. On average, Filipinos in the Philippines save only 0.63% of their money.

It’s like consumerism on steroids! Part of the reason is cultural; part of the reason is that the majority of Filipinos are unbanked and have no place to put their money; and part of the reason are socio-economic factors that I will write about in another post (I promise).

Here’s a true story: recently, someone I know asked me for a small loan. Thinking that the money would be used to feed her family, I was willing to provide the loan; however, when I asked what the money would be used for, she told me the money was to replace an out-of-date phone with the latest iPhone.


I know people who spend a lot of pesos on non-essentials (i.e. cosmetics, smartphones, etc.), when they barely have enough money to buy food for their family or books for their children. And there is zero money left if they are befallen by an emergency or calamity.

And as a result, the poverty cycle continues …

7. Remittances are up, but the poverty rate improves very little.

In 2013, overseas remittance into the Philippines grew by 7.6 over 2012. The number of people living below the poverty dropped, but only by 1.3%.


I think it’s a combination of some of the things I mentioned above, namely (1) a high number of Filipinos are unbanked; (2) the high cost of a cash economy; and (3) consumerism on steroids.

But I believe there is hope …

If you are the provider for your family, you can make a difference.

Don’t just do what you have always been doing cause “that’s the way it is.” You can make the decision to try something different to improve your circumstances.

At BeamAndGo, we strive to be that something different. Our goal is to help people spend wisely in order to build a strong financial future. And we are working hard to provide you with a better way for you to take care of yourself and your family in the Philippines.

To learn more about what we are doing at BeamAndGo, just visit us at http://www.BeamAndGo.com. If you have any questions or comments, you can contact me directly at jonathan.chua@beamandgo.com. Feel free to share this article with your friends and family.

Published by Jonathan E. Chua

Beam&Go CEO * Duration CEO * AC/DC * Swim * 110% * Pizza * Singapore * Run * Professionalism * Zep * Manila * Caddyshack * Burgers * Bike * Respect * NYC * Stones * The Knicks * Aud * Gabs @THE_REAL_JCHUA

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