STATE-run Social Security System (SSS) urges its pensioners to avoid loan sharks that offer high-interest rates and confiscate their debit cards as collateral.
The SSS instead encourages pensioners to avail of the agency’s pension loans with “low interest rate” of 10 percent per annum.
For the first half of this year, the SSS has already approved the release of P1.47 billion pension loans for 33,007 retiree-pensioners, the pension-fund manager said in a statement. Of the amount, P1.38 billion was approved for 30,772 retiree-pensioners who filed their applications through SSS branches; the remaining P96.62 million was approved for 2,235 retiree-pensioners who filed applications online.
The SSS said that under its pension loan program (PLP)—launched in September 2018—qualified retiree-pensioners may avail a loan of up to three, six, nine or 12 times their basic monthly pension (BMP) plus the P1,000 additional benefit, not exceeding the maximum loan amount of P200,000. Moreover, their net take-home pension must be at least 47.25 percent.
Pension loans of three times and six times the pensioners’ BMP plus the P1,000 additional benefit have respective payment terms of six months and 12 months, while pension loans of nine and 12 times the BMP plus the P1,000 additional benefit have a payment term of 24 months.
Apart from a low interest rate, the SSS said the first monthly amortization for pension loans is due on the second month after the loan was granted. Further, a 1-percent service fee is waived as a means to subsidize the payment for the premium of the credit life insurance of the borrower.
The SSS aid it has been enhancing its online facility to accommodate first-time PLP applicants.
To qualify for the loan program, a retiree-pensioner must satisfy the following:
- must be 85 years of age or below at the end of the last month of the loan term;
- must have no deductions such as outstanding loan balance, benefit overpayment payable to the SSS, etc., from his/her monthly pension;
- must have no existing advance pension under the SSS Calamity Assistance Package; and must be receiving his/her regular monthly pension for at least one month and the status of pension is “active.”
Applications of those availing the SSS’s pension loans for the first time must be coursed through SSS branches, following community quarantine protocols and servicing guidelines (number coding system, drop box system, or appointment system).
On the other hand, retiree-pensioners who have previously availed the program and have already paid their loans in full may submit their applications online via the SSS web site.