Cebuana Lhuillier sees 5-10% decline in remittances due to COVID-19

Non-bank financial services firm Cebuana Lhuillier has started to bear the brunt of the coronavirus disease (COVID-19) threat as it saw a slowdown in its remittance business.

On the sidelines of an event in Makati City on Thursday, Cebuana Lhuillier president and CEO John Henri Lhuillier said the company has estimated around 5% to 10% slowdown in remittances in January.

This amid travel restrictions in virus-stricken China, Macau, and Hong Kong may have prevented movement of Filipino workers based overseas.

“We have seen a little slowdown last month,” Lhuillier said.

He said Cebuana Lhuillier has put in place mitigating measures to help the firm cope with expected slowdown in remittances.

“We’ve come up with a lot of more service fee tweaking. We’re prepared,” Lhuillier said, noting that remittance business is Cebuana Lhuillier’s second revenue driver.

“Hopefully, it will settle down in the summer months,” he said.

Nevertheless, Cebuna Lhuillier remains optimistic that remittances will continue its growth.

“Aside from that (COVID-19), I don’t see other reasons slowing down money remittance in the Philippines. It’s still a growing space in terms of Filipinos sending their cash to their loved ones,” Lhuillier said.

The Duterte administration expects the coronavirus outbreak to have a minimal impact on remittances from Filipinos based overseas.

Cabinet Secretary Karlo Nograles said the government has lowered the remittance target for this year to $34.2 billion or a slightly lower expansion by 2.2% from $33.47 billion.

Previously, the government pegged the remittance target at $34.5 billion or a growth rate of 3%.

According to the Bangko Sentral ng Pilipinas, personal remittances accounted for 9.3% of the economy, as measured by gross domestic product (GDP), and 7.8% of the gross national income (GNI). — MDM, GMA News