The Social Security System (SSS) said on Saturday that it approved about 1.923 billion pesos in loans under its Enhanced Retirement Loan Program (PLP) from January to August 2021.
The approved loans benefited 43,424 retirees, according to the state-run pension fund.
SSS President and CEO Aurora Ignacio, however, said approved retirement loans fell 17%, from Pesos 2.311 billion approved in the same period last year.
âWe can attribute the decrease in approved retirement loans to the lower number of retiree borrowers this year. SSS records showed that there were 43,424 retiree borrowers from January to August 2021, or 15% less than the 51,121 borrowers in 2020, âshe said.
âThis is in part due to the restricted mobility of seniors provided by quarantine protocols. In addition, some of them are still repaying their retirement loans granted to them last year.
The pension fund said the SSS Bacolod branch has the highest amount of approved pension loans at 89.36 million pesos for 2,649 retirees.
SSS Cebu came in second with 44.87 million pesos of retirement loans approved for 962 borrowers.
SSS Davao came in third with 38.26 million pesos in retirement loans approved for 930 borrowers.
SSS Bacoor with 37.38 million pesos for 722 borrowers and SSS Antipolo with 33.45 million pesos for 651 borrowers round out the top five.
Launched in September 2018, PLP aims to help SSS retirees with their financial needs and prevent them from falling victim to private moneylenders with higher interest rates and taking their ATM cards as collateral.
âWe recognize that they need financial help to increase their daily expenses, especially since we are in a time of a pandemic. The PLP can help cover expenses related to their drugs, vitamins and other health care needs, âIgnacio said.
Under the program, eligible retirees can receive a loan equivalent to three, six, nine or 12 times their basic monthly pension (BMP) plus the additional benefit of P1,000.
However, the loanable amount must not exceed the maximum loan limit of 200,000 P. In addition, the net pension of the retiree-borrower must be at least 47.25%.
A pension loan equivalent to three and six times the pensioner’s BMP plus the additional P1,000 benefit will have a payment term of six and 12 months, respectively.
Meanwhile, a pension loan equivalent to nine or 12 times the BMP plus the additional P1,000 benefit will have a payment term of 24 months.
The first monthly repayment of the retiree will be due the second month after the granting of the loan by the SSS.
For example, if the loan is granted in August, the SSS will deduct the first monthly amortization from the retiree’s monthly pension in October, according to the SSS.
Pension loans will only bear interest at an interest rate of 10% per annum until they are fully paid, calculated on a declining principal balance.
It has a lower interest rate than those offered outside with an interest rate of up to 20%.
Unlike some private lending institutions, SSS will not require retiree borrowers to return their ATM cards with their monthly pension to ensure loan repayment.
To be eligible for the loan program, retirees must meet the following requirements:
* must be 85 years of age and under at the end of the last month of the loan term;
* no outstanding loan balances and overpayment of benefits payable to SSS;
* no early pension available under the SSS Calamity Assistance Package;
* must have been receiving their regular monthly pension for at least one month with an âactiveâ status.
Those qualified for renewal can now submit their applications online using the My.SSS member portal, which they can find on the SSS website.
First-time borrowers will be able to apply online once the PESONet disbursement facility is available for the PLP. – VBL, GMA News