State pension fund Government Service Insurance System (GSIS) Acting President and General Manager Rolando Ledesma Macasaet signed an agreement with Manila City Mayor Francisco “Isko Moreno” Domagoso on Tuesday (February 4) that will open the GSIS’s loan transfer and consolidation program to all qualified employees of the Manila City Government (CGO).
A total of Php2.2 billion has been earmarked for Manila CGO employees who will avail of the loan program.
“Ang programa pong ito ay tinatawag naming GSIS Financial Assistance Loan Program o GFAL. Ito po ay isang loan transfer and consolidation program. Ang ibig sabihin po nito ay kung meron kayong utang sa ‘five-six,’ bibilhin po namin at ililipat sa GSIS. Sa GSIS na kayo magbabayad through salary deduction. At dahil may GFAL na sa CGO Manila, tataas na ang take home pay ng mga empleyado at hindi na nila kailangang isangla ang kanilang ATM cards sa ibang lenders o kaya ay mangutang sa 5-6,” Macasaet said during the signing of the agreement.
He also committed to set up a GSIS service desk at the Manila City Hall to accept GFAL applications.
For his part, Mayor Moreno said “this is one way of protecting the future of our employees who dedicated their lives to public service … na proteksyunan ang kanilang karapatan.
Thank you sa GSIS at makakautang na ang aming mga empleyado.” GFAL has a 6% interest rate per annum computed in advance and a 6-year payment term through salary deduction.
Under the program, GSIS members may transfer a maximum of Php500,000 amount of loan from accredited lending institutions to the GSIS.
If the amount of the loan balance transferred to GSIS is lower than Php500,000, borrowers may apply for the remaining credit as Top-Up Loan for their other needs. GSIS pays GFAL’s proceeds directly to lenders, while Top-Up loan proceeds are released to members.
“GFAL is our intervention measure in response to President Rodrigo Duterte’s order to help end the cycle in which GSIS members fall prey to predatory lending businesses that charge staggering interest rates,” Macasaet said.
To qualify for GFAL, applicants must be permanent government employees with outstanding loan from private lending institutions, government banks, cooperatives, or other instrumentalities accredited or recognized by their agency; with paid GSIS premiums for at least three years; no due and demandable GSIS loan account; not on leave without pay; with a net take-home pay of not lower than Php5,000 after deduction of monthly obligations; and no pending administrative case or criminal charge.
However, a borrower with pending case is still eligible to apply for GFAL if the case was filed by a lending institution due to nonpayment as a result of the prioritization of payroll deductions.
To date, GSIS has disbursed more than Php86 billion through the GFAL since its launch in May 2018 for the Department of Education employees and for other agencies in July 2019.
The deadline for submission of application for GFAL has been extended until July 26, 2020.
“We are glad that Mayor Isko Moreno has been diligently looking after the welfare of Manila City Hall employees. In May 2019, he swiftly acted to negotiate their Php195 million debt in premium payments which, once settled, will benefit active and inactive members in terms of higher separation or retirement benefit,” Macasaet said.
Mayor Isko viewed the reconciliation efforts between the two offices as “an opportunity to clear the books of Manila with regard to our obligations to GSIS done in the past. Sampung libo kami dito na umaasa sa institusyon ninyo and we believe in you – that you are protecting the interest of your members.”
