SSS relaxes rules for educational loan
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MANILA - More members of the Social Security System (SSS) can avail of its education loan window, after the pension fund relaxed some of its rules.
In a statement, SSS president Emilio de Quiros Jr. said the pension fund has liberalized the guidelines of its SSS Educational Assistance Loan Program (Educ-Assist).
Among the changes in the rules is an increase in the qualifying salary ceiling from P15,000 a month to P25,000.
"Members can now borrow up to P20,000 per semester or trimester, up from the previous limit of P15,000 for college degrees. For voc-tech courses, we likewise increased the maximum loanable amount to P10,000 from the previous cap of P7,500 per semester or trimester," de Quiros said.
The government subsidizes half of the P7 billion Educ-Assist Fund.
The loans must be used to pay for tuition and miscellaneous fees and are intended to help students from low-income families.
Besides SSS members, their children or siblings can qualify for the educational loan.
Under the pension fund's new guidelines, a married SSS member can now designate up to two loan beneficiaries, who can be the member or their spouse or legitimate or illegitimate children. Unmarried members remain entitled to one loan beneficiary.
"It is now possible for a married couple, who are both qualified borrowers, to support the education of up to four children through Educ-Assist loans," de Quiros said.
"Meanwhile, unmarried members can use the loan to help their siblings pursue their studies and lighten their parents’ financial burden at the same time," he added.
Another change in the guidelines is a less stringent contribution requirement. SSS members with at least 12 posted contributions, including at least one paid contribution within the past three months prior to the date of application, are now allowed to borrow.
Members without any contribution for the past three months can pay and present the proof of payment to SSS.
Previously, a member must have at least 36 monthly contributions, three of which should be within the 12-month period before the application date, to qualify.
"The SSS has disbursed over P195 million so far in Educ-Assist loans to thousands of student-beneficiaries all over the country," de Quiros said.
"We have already earmarked about P590 million, or 11 percent of the total fund allocation, for these students so that they can complete their chosen course, and we expect availment to increase further as a result of the revised guidelines," he added.
Loan repayment meanwhile will start one year after the beneficary’s graduation or the date of last loan release.
Borrowers for college degree programs have five years to repay the loan, while those who borrowed for voc-tech courses are given three years.
The portion of the loan financed by SSS carries an interest rate of six percent per annum based on diminishing principal balance until full payment. But since the government subsidy carries zero interest, the "blended" annual interest rate amounts to three percent.
A loan beneficiary must enroll in a college that is accredited by the Commission on Higher Education. If taking up a voc-tech course, the school must be at least a two-year program recognized by the Technical Education and Skills Development Authority.
Educ-Assist application forms are available at SSS branches or downloadable from the SSS website.