Twice recently I have been awoken from my sleep by a text message from Lloyds bank in the UK saying:
Dear MR NEIL PORTER. FPXXX . We have been unable to process your payment 11/09/2023 for USD XXXX GBP XXX for the Following all payment to the Philippines require now a Purpose of Payment Code which is mandatory by law of that country
The first time they declined a transfer was on August 29th. That was for a smaller value ( one month pension) that I requested online on August 23. That time they did not send me a text or notify me and I was daily checking my ATM here to see if the money had arrived. Apparently the money was sent overseas but then returned to the UK
As a retiree I have no income in the Philippines and am dependent on my Pension which is paid into my UK bank and which I then transfer to my Philippine bank ( Union Bank)
I usually make the transfer every third month as Lloyds charge me £9.50 for each transfer. ( 674 Peso) and they normally transfer the money in 5 working days . The transfers in March , May and July went through ok but the August ones did not.
As I was running short of money here I tried to transfer more money on September 9th , when I realised the money I tried to transfer in August was not going to arrive . That is when I had the first text about Purpose of Payment (POP) codes.
The annoying thing is it does not say , when you try to transfer the money with Lloyds, that it is now a mandatory requirement to have the POP, or give you a drop down list to pick from. If you send money from the UK to Bahrain you select a code from a long list which you are given : (https://support.currencycloud.com/hc/en-gb/articles/360017430000-Payment-Purpose-Codes)
This piece also lists the countries requiring a POP:
Countries requiring payment purpose codes
The following countries require payment purpose codes to be submitted with the transaction:
- Bahrain (SWIFT payments in all currencies)
- China (SWIFT CNY payments only)
- India (local INR payments to India only)
- Malaysia (local MYR payments to Malaysia only)
- United Arab Emirates (SWIFT payments in all currencies)
There is just a box for "reason for payment" and you select this from a drop down menu provided by Lloyds- but they are words , not 10 digit POP codes, and there is no box to enter a POP code! Yet they then reject it if you do not enter the POP code!
I googled POP codes and discovered:
http://connect-content.us.hsbc.com › 15_ph_pop
Effective 19 October 2015, the inclusion of
Purpose of payment code will be mandatory for payments debiting
Philippines accounts made on-screen in HSBCnet ...
COMPEN: Employee Compensation (i.e.
Payr...
VENDOR: Vendor Payments / Trade
Payables
People also ask
What is the purpose of payment code?
Purpose Codes are four letter codes which are carried across the
payment chain, providing information to all users in the payments chain to
indicate the reason a payment is being made."
The observant of you will have picked up 2 discrepancies with the Lloyds text:
1. Lloyds say the Philippines require now a Purpose of Payment Code which is mandatory by law of that country - the piece on google relates to a change in 2015 , and I have had many transfers completed since then without a code
2. The google piece refers to a four letter code- whilst Lloyds insist they need a 10 figure code.
So why is the Philippines insisting on this code ( in defence of Lloyds they are only implementing the law ) . When I first moved here in 2022 I faced major hurdles in moving my money here ( and back then I was moving a lot more money to pay for furniture and equipment for my new house, a $10,000 bond for my retirement visa ( SSRV) and so on. I was told that the Philippines was regarded as High risk of money laundering by the UK Government ( HMRC) and they had to verify that the account they were sending the money to ( Union Bank) was genuine and what was the purpose for each transfer. At one point this resulted in them suspending my account until I called them ( from a mobile long distance to receive a message saying I was in a queue and whilst my business was important to them they were experiencing higher than usual call volumes and there would be a 30 minute delay). When I finally got through they asked questions like:
1.What the money was for- a Bond for my Retirement Visa
2.Who asked for the bond?- the Philippine Government ( PRA)
3. How did I get the account number to pay it into - Union Bank emailed me
4. What was the name of the person who emailed you and their address?
5. How did you meet this lady?- when I went to the bank with my letter of introduction from PRA
and so on. Eventually they allowed me access to my account but warned me future payments may be rejected- several were and I had to repeat these calls but finally the money went through normally- until August.
Why am I telling you all this?
One of the reasons I set up this blog was so people could follow my journey from working in the Middle East to retirement in the Philippines. I also wanted to share the problems I faced ( like getting my SSRV which I covered in an earlier blog:
https://thebritishkabayan.blogspot.com/2023/01/tbk-tells-finally-i-have-my-special.html) and how to overcome them , so you do not face as many problems as I did.
For example I have now given another Brit who has retired here the name of an agent in Puerto Princessa to use to help him get his SSRV- it really is worth paying her fees as she has contacts here, can shorten processes ( like NBI clearance) and will guide you through the complex process of medicals, form filling, the bond ( which must come from outside the Philippines as a Foreign remittance) and so on.
If you need help I highly recommend Zenette Ong for help getting your SSRV, Visa Extensions etc . When I was in El Nido and my first tourist visa was about to expire I sent my passport to her by van and she got the visa extension for me. She is now trying to get me a Philippine Tax Identification Number or Philippine Social Security Number which I need to get a credit cars here.
https://www.facebook.com/zenette.ong
So how can you get around the problem with transferring money to the Philippines?
Several of my British friends have suggested a money service business called WISE:
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https://wise.com/gb/send-money/
Essentially you set up an account with them online which is free - it takes a while and you will need your Philippine ID ( I used my SSRV) and passport, which you photograph using your mobile and then you take a selfie which they match with the photo on the passport . It takes a while to get the passport details clear and the photo in the right place ( I nearly forgot to remove my glasses as the passport photo does not have glasses. You then specify where the money will come from and you have to give evidence of this ( eg your pension) and then you show them how you will move the money to the wise account. Andy did this with his UK Debit account, Mike uses a Bank transfer or you can cable or wire transfer the money if you are in the USA.
When you want to transfer money to the Philippines you then do a UK ( in my case) transfer from your bank ( Lloyds) to your wise account which goes through in 2 hours. Then you use Wise to transfer the money to your Philippine account which they promise will take a maximum of 2 days ( as opposed to 5 working days with Lloyds). Be aware of Bank / Public holidays in your country or the Philippines and weekends as the money will only move on days the banks are open. If you are not in Manila ( I live in Palawan) remember the money has to go through a clearing house in Manila - in August this was closed for two working days due to a tropical storm . So on that week with 4 days of weekends, 2 days of flooding, a public holiday 7 days were added to the 5 working days making it 12 days for the transfer to reach me ( assuming Lloyds had not blocked it)
I do not want to make this sound like a rant against Lloyds but another factor to consider when you first move here is the fact that most banks in the UK use two step verification calling your mobile and then you enter the code from the internet banking into the phone and the transfer goes ahead. Stupidly I did not update the number with Lloyds before leaving Bahrain( as I did not have a Philippine mobile then) so every time they tried to call my mobile they were unsuccessful ( as the credit /load on my Bahrain phone expired and the SIM became invalid). So get someone to get you a phone number here and give that to your bank before you leave. Paul and Beth suggested physically visiting your bank ( I have not been to the UK for 13 years so was unable to do that) and explain what you are doing. Then they will need to verify your new address in the Philippines with a copy of a utility bill and bank statement with your Philippine address on . As I rent a house in a compound with several properties our landlady has the utility bills in her name and then she pays and we refund her. I had to have a separate water supply installed to get my own bill and get an Attorney to prepare an Affidavit signed by my landlady before they would verify my address. That all took several months and cost me over £1500/ 106,000 peso in charges for using an ATM to with draw money from my account in Bahrain, Borrowing money, phone calls to the UK, courier fees ( they wanted a signed letter by post to verify my new address)
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The strange thing is that the Philippine Retirement Authority (PRA) state that :
"The Philippine Retirement Authority (PRA) is a government-owned and controlled corporation mandated to attract foreign nationals and former Filipino citizens to make the Philippines their second home or retirement destination.
The Special Resident Retiree’s Visa (SRRV) is a non-immigrant multiple-entry, indefinite-stay visa. With the SRRV, the holders may stay in the Philippines for as long as they want without giving up their citizenship."
When new Purpose of Payment codes are introduced with no notification or explanation and pensioners here cannot transfer their pension to the Philippines to buy food, pay car and house rental bills and so on and have to go begging for loans from other expats and University students it really does nothing to attract foreign nationals, make them feel welcomed and want to stay!
I have asked Union Bank for a list of the codes and once I get them I will share them with you! However in spite of several emails my Union Bank contact here has been unable to find them. Lloyds suggested I google them as they do not have a list- they were just told a few weeks ago to make sure all outgoing payments had a POP!
I would like to thank Lloyds for handling my complaint so quickly and calling me several times to explain what happened. She promised to pass on my suggestions about providing a list of codes, notifying people making transfers of the need to use the codes and making it easier to contact Lloyds from overseas, instead of having to call a call centre. She asked if it would help if I had a direct line number to the International transfer helpdesk and I said that would be great then she checked and told me there was not one. My brother suggested I ask a friend to visit a Lloyds bank in UK to find out what the codes are- so if anyone is reading this and has time I would be very grateful. Finally thanks to Lloyds for the compensation they credited my account with yesterday. That makes it TBK 1, Lloyds 1!
Special thanks to Mike for transferring me the money via Wise, Andy for helping me set up my Wise account, Maggie, Benny, Andy , Kit and Elay for lending me money and my car hire company for being so patient when I could not pay this months rental.
I hope this information is of use to people thinking of moving here and if you want information on anything else please contact me.
Hello, I am The British Kabayan! Feel free to read my stories.
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