The state-run Social Security System (SSS) on Wednesday said more than 1.29 million members availed the short-term loan privilege of the pension fund through the SSS Salary Loan program from January to August 2019.
SSS President and Chief Executive Officer Aurora C. Ignacio said the pension fund disbursed more than P26.33 billion worth of salary loans in the first eight months of 2019.
This is 10.2 percent higher than the P23.89 billion recorded in the same period last year for more than 1.20 million borrowers.
The bulk of the releases went to nearly 1.16 million employed members with a total of P24.50 billion worth of salary loans, followed by more than 104,000 voluntary members with P1.49 billion, 12,411 Overseas Filipino Worker members with P233.01 million, and 13,724 self-employed members with P109.72 million.
“From 2014 to 2018, we have recorded a yearly average increase of 7.3 percent in the amount of salary loan releases and 6.9 percent in the number of borrowers,” Ignacio said.
The salary loan is the most availed of the loan program of the SSS. Under the program, members may borrow a loan amount of up to twice the average of their 12 latest posted monthly salary credits.
It is payable in two years in 24 monthly installments with an interest rate of 10 percent per annum based on its diminishing principal balance.
To qualify for a salary loan, the member must be under 65 years old at the time of application, has not been granted any final benefit such as permanent disability, retirement or death, and has not been disqualified due to fraud committed against the SSS.
In addition, the employer of an employed member-borrower must be updated in the payment of contribution and loan remittances.
For the one-month salary loan, the member must have at least 36 posted monthly contributions, six of which should be within the last 12 months prior to the month of application while for the two-month salary loan, he/she must have at least 72 posted monthly contributions, six of which should also be within the last 12 months prior to the month of application.
Members should submit their salary loan applications online through My.SSS facility in the SSS website or SSS mobile application starting November 11, 2019.
Employed members’ applications shall be certified also online by their respective employers.
“The SSS’ salary loan program is our way of providing our members with the means to support their short-term or emergency financial needs. We are glad that more members are able to benefit from this program,” Ignacio said.