The government is mulling to establish the country’s first labor bank with an aim to formally channelize remittances and provide loans to migrant workers at subsidized interest rates.
Ministry of Labor and Employment (MoLE) has started necessary preparations in this regard and plans to set up the bank within six months.
Minister of State for Labor and Employment Tek Bahadur Gurung informed that the bank is going to be established for sole benefit of migrant workers.
“We decided to open up a bank for the benefit of migrant workers,” Minister Gurung said, adding, “They can take loans from the bank at subsidized rates and at the same time, we will be able to formally channelize the remittances.”
Nepali migrant workers in any part of the world can open accounts at the bank and send their earnings to their respective families through the bank. In the meantime, the families of the migrant workers can also get loans from the bank to start businesses and support their children’s education among other things.
Stating that such banks have been successful in Japan and Canada, Minister Gurung informed that the fund required to set up the bank will be arranged through the Foreign Employment Promotion Board (FEPB) and Welfare Fund under the Department of Labor.
Acting Executive Director at the FEPB, the decision of the government will make good use of the money which is accumulating at the welfare fund.
The decision of the government comes amid allegations that the funds in government-owned organizations are sitting idly.
Each migrant worker has to deposit Rs 1,000 at the FEPB before departing to the destination country. Currently, FEPB has around Rs 2.50 billion while the Welfare Fund holds around Rs 6 billion.
Every day around 1,500 to 2,000 Nepalis leave the country for foreign employment. According to the figures provided by the Department of Foreign Employment (DoFE), 3,385,707 Nepali migrants have already taken work permit till date for different countries.
Malaysia, Qatar and Saudi Arabia are among the top three employment destinations of Nepali workers.