Loan payments now top FDH expenditure

The study results were released this morning.

Filipino domestic workers are now spending more money on agency fees and loan payments than on remittances to their families back in the Philippines, according to a research study conducted by two non-governmental organizations (NGOs).

The study, dubbed “Where Do Your Wages Go?—A Research on the Expenditures of Migrant domestic Workers in Hong Kong”, interviewed 1,000 Filipino domestic workers on how they spend their monthly salary.

It was conducted by the Mission for Migrant Workers (MFMW) and the Asia Pacific Mission for Migrants (APMM).

“Results of the research revealed that most of the wage of FDWs (foreign domestic workers) are spent paying for agency fees and loans related to paying charges by recruitment agencies,” the MFMS and APMM said in a joint statement.

“At 36 percent, it is higher than (the amount spent on) remittance to family, which is at 32 percent of their total expenses,” it added.

The study showed that the FDWs’ expenditure on loans and agency fees grew by 22 percent compared to that in 2013, when a similar survey showed that loans and agency fees took up only 13.56 percent of their monthly salary.

In 2013, remittances took up 53.48 percent of their salary but, this time around, the FDWs spent only 31.7 percent of their salary for their families back in the Philippines.

“The dip in the remittance from the 2013 survey showed the impact of grossly high agency fees eating up on the capacity of FDWs (to send money) to their family,” the MFMW and APMM said.

“Instead of enabling FDWs to increase their support for their families due to the surging inflation rate in their home country, (their) forced obligation to agency and loan repayment make them either barely maintain or even cut on the remittance they send,” they added.

To remedy this, they urged the Hong Kong government to increase the minimum wage of FDWs to $5,500 and the food allowance to $2,500, and for it to  “actively address” the problem of overcharging employment agencies.

The research study also showed that besides loans and remittances, the FDWs other expenses included savings (9.4 percent), food (5.9 percent), other expenses (5.1 percent), clothes and accessories (3.4 percent), communication (2.8 percent), transportation (2.4 percent), toiletries (2.3 percent), and donations (1.4 percent).