Helping Caregivers Around the World None-Profit to cut down interest rates on loans for caregivers Background: Caregivers pay thousands of dollars placements fees in order to get overseas work. They often need to borrow the money at very high interest rates of 84% or higher. This none-profit project will raise public awareness with aims at cutting down the placement fees by at least 40%. In the meantime, we will cut down the interest rates below 7% annually. The needs in Israel alone are for tens of millions dollar a year. Raising such amount is extremely difficult. Instead, we plan to convince thousands of private people to give private loan. Millions of private people around the world are eager to give secured loans of about 7% annual interest. Our mission is to raise awareness to the problem and convince the public that caregivers who work under multi-year contract are safe borrowers. Less than 1% of caregivers break their contract before the 5 years are over. * Those numbers might be different in different countries In addition, we will raise donations to serve as securities for the very few situations of defaults. Raising funds for securities will allow us to raise much smaller amount than raising funds for the actual loans! The loans will be for private use regardless of the placement fees amounts*. In addition, we will raise huge public awareness about the placement fees and strive to lower them in order to leave the caregivers more money to help their families. *Placement fees amounts are often illegal and rarely officially published. Two Campaigns: We are running two separate campaigns: 1) Campaign towards private people with the request to lend low interest loans to caregivers 2) Fundraising campaign to raise funds for be the securities of the loans.
First Campaign: A. Raise public awareness about the problems and needs of caregivers all around the world B. Convince the public that many caregivers are very safe borrowers because they work on a 5- year contract, which they hardly ever break. We will ask the public to lend caregivers loans at below 7*% annual interests to be paid within 55 payments (but no longer than the life of their remaining contract). * But always below what is allowed by law in their country (I believe in Israel it is 6.9% annually). Second Campaign: raise funds for Zero Interest Loans charities. Those funds will be used by them to give loans to their sectors. In addition those funds will serve as securities for the loans for the caregivers. Caregivers that work on a contract hardly ever break it. Therefore, we could leverage the securities to at least 1:50 and maybe even 1:100. That will greatly reduce the amount we need to raise to a manageable amount. In Israel: we will need to raise less than million dollars in order to allow loans of 50 million dollars each year. Our goal in Israel is indeed to raise $1M. We will duplicate this fundraising to about 20 different countries/regions and will continue for 5 years. Zero Interest Loans charities: There are dozens of Zero Interest Loans charities in Israel. They all serve very specific sectors none qualify caregivers. In any case, I assume that all those charities have greater demands for loans than funds available. Our offer to raise funds for them in exchange for providing securities (on certain terms) should be very attractive offer for them. Marketing: The marketing will be run mostly by caregivers. We need to provide them very basic tools, leadership and motivation. Many caregivers work for retired or families of very important people in government, media, public figures, celebrities, etc. We will lead them to use those connections for the sake of the entire caregivers' communities. We should start by December 2017. Join our group below to learn more details Please help make this letter and the associate videos go viral.
Important Notes: The challenges are to raise awareness amongst the public about the needs and problems of the foreign workers, awareness about their financial strength due to their contract and to establish securities for the very few situations in which the workers do not complete their contract. Loan amounts: Our vision is to provide foreign worker loans of up to $10,000* to be paid in 55 months (a bit shorter than their working contract) at about 7% ANNUAL interest. The actual loan amount is calculated according to the following data: A. Amount of months left on the contract minus 3. So a caregiver who has 47 months left on his contract will have to pay the loan back within 44 months. B. Each payment not to exceed 30% of their monthly earning. Caregivers earn different salaries in different countries. C. The interest rate never to exceed 7% annually or the max allowed by law in the country of where the caregiver works. The purpose of the loan is to provide immediate help for their families and for personal use. The lower we will cut the placement fees, the more of the loan caregivers will have to help their families. Note: the loan is not related to the placement fees. Most placement fees are illegal and are paid without receiving legal receipt. Therefore, caregivers are unable to produce such receipt. The placement fees: lowering the placement fees and establishing them legally is not the focus of our campaign. However, we desire to raise public awareness and recruit public figures that will force alternative solutions to the current situation. True solution will be when good people will establish such agencies in order to really help caregivers for much lower profit margins. Caregivers MUST be vigilant in spreading out this letter and all of our other materials.
Our offer to the charities: we offer to raise donations to Zero Interest Loans Charities for their own use. In return we ask them to provide securities for the private loans to caregivers at the amount of the donations we give them. We estimate that those securities will leverage loans of 50-100 (depends on the country) times more. In addition, we suggest that the organization will receive $100 donations from the lenders and earn $50 processing fee from the borrowers. That means that the lender lends out $10,000 plus $100 donation and the borrower receives $9,950 but pays back loan of $10K. This means that the charities will gain much more than the security they provide. In addition; we will campaign for private people to give caregivers Zero interest loans to be paid back on monthly basis to the charity. The original lender will enjoy the tax write-offs spread in the length of the loan. That would be a great solution for everybody. Very important: we wish to collaborate with strong charities who will lend the donations to their circle of supported people and still be able to provide securities. Starting in Israel: Remember that the loans are given to very hard working people that often work 70+ hours a week. They are victims to a system that allows greedy people to take advantage of them. Compassion people should step up to help them. Israel is a great place to start this venture because it is not a new concept here. This should become the template to help all caregivers around the world. We hope that this will also develop strong awareness and will bring in influential dignitaries that will start a strong movement to cut down the placement fees. Share this letter with ALL caregivers around the world and ask them to share with the families of their employees and with the general public in the countries they work at. Message to the Caregivers: I first offered similar proposal in October 2015. However, it was rejected by most Filipino organizations in Israel. This is probably due to a lot of internal organizations politics and egos. It is also possible that the people who profit from the high interest rates are often very well connected with those organizations. This could be (I have no way to know for sure) a contributing fact that drags the solutions for the problems for so many years.
We should not lose any more time. We all need to reach out to influential people within the public of the countries where you work. Don't just stay passive and relay on your organizations. Express your desire and excitement for this proposal and be pro-active in sharing this with your employers and their families and the general public. Many of you work for retired or families of dignitaries, government officials, media personal, retired military general s, successful business personals and more. Take the responsibility to share this letter and our videos with them. It is important that they will be aware of your problems, needs and our offered solutions. Many of them will be happy to help the caregivers and will jump on the opportunity to give secured loans at about 7% a year. By all means, share this with the Filipino government and express ambitious expectations from them. Don t allow them to wave the issues with cheap promises. But at the same time, don t wait for their response before sharing with the public where you are working at. Summary Both Placement Fees and High Interest rates are major hardships for caregivers who work all over the world. It is important to solve both problems as soon as possible. The Interest Rates issue could be resolved through private lenders that are willing to give loans at below 7% annual interest. In addition, we will raise funds to be securities for those loans. Join our Facebook group, watch our videos, learn more and get updates at https://www.facebook.com/groups/philisrael Best regards, Eytan Katz https://www.facebook.com/eytan.katz.3
Appendix 1) Disclaimer and suggestion I am not a lawyer. This paper is just for the purpose of raising awareness and to find suitable charities. Everything in this paper is considered as suggestions. We will ask the charity to write a standard agreement between lenders and caregivers and to inform what documents the caregivers need to provide in order to prove their employment status. We suggest that each lender will give $100 donation above the value of the loan to the charity. We suggest that $50 will be deducted from each borrower as processing fee. I ask lenders to lend at lower interest rate than 7% annually and even at ZERO interest rate. We believe that many people will lend out of compassion rather than the opportunity to profit. Consider donating the loan payments to the charity. Give the loan to the caregiver and arrange that they will make the monthly payments towards the charity. I am sure it will be possible to credit the monthly payments as your donations. We will run an online fundraiser for the charity. We expect all caregivers to volunteer their time towards promoting the fundraiser. 2) Sharing with the Filipino government: I ask the Filipino government to help for number of reasons: A. It is their duty to serve the Filipino people and try to achieve the best for them. B. This is a template to help ALL caregivers (Indian, Nepal, Sari-Lankan, etc) and other foreign workers (Thailand and others) all around the world. Whatever we do in Israel should be repeated for foreign workers working in other countries. C. This will help tens of thousands caregivers to send thousands extra dollars to their families in the Philippines to invest more in the Filipino homes and economy. That could end up investing hundreds of millions more dollars in the Philippines. The Filipino Embassy expressed their objection to the project because they say that easy loans will just encourage agencies to increase the placement fees even more. True; with bad leadership this could indeed be the case. However, the embassy represents the authority that is responsible to show the leadership to cut down the placement fees regardless of the interest rates. They cannot use their inability to solve the placement fees problem as an excuse to not help solve the high interest loans problem. They should endorse this project.
3) Modifications made in 2017 There were 2 main reasons the proposals in 2015/6 failed: A. Required too much donations - Originally we suggested that the charities would provide Zero Interest loans to caregivers. However, that would have required tens of millions dollars in donations a year just in Israel. The fact is that even loans at 7% annual interest would be savers for caregivers. So we modified our mission to ask private lenders to give caregivers loans at below 7% annual interest. Those loans would allow us to raise significantly smaller amount of donations just for securities. This means that in Israel alone we will need to raise less than one Million dollars instead of 50 million dollars. 7% annual interest for secured loan should be very attractive incentive for many Israelis to provide private loans. B. Lack of cooperation from caregivers - The 2015 proposal was very one-sided in favor of the caregivers. Yet, they showed lack of appreciation and motivation and had many inner divisions. All of that caused the failure of the proposal. This proposal is driving to benefit also private lenders from the general public. We hope this would make much greater BUZZ for the venture.