The state-run pension fund Social Security System (SSS) expects to collect an additional P8.6 billion in the next five years on top of the P5.2 billion it already collected in the last 12 months from its loan condonation program.
In a statement on Sunday, SSS president and chief executive Emmanuel F. Dooc said over 850,000 members availed of the program that it offered for a year beginning April last year.
“We are very much overwhelmed by the huge volume of applicants, especially during the last few days before the deadline. We hope that members will be faithful in paying their restructured loan amortizations to avoid further penalties. We are expecting P8.6 billion in collections until the end of the five-year installment term,” Dooc said.
As such, total collections from the loan restructuring program is expected to reach P13.8 billion by 2022, Dooc said.
The program allowed delinquent borrowers to settle their unpaid loans in full within 30 days without added interest. They were also granted an option to pay up to five years, but with an interest of 3 percent a year.
“We would like to remind our loan restructuring program availees that loan penalties will be completely waived only after full payment of the principal amount and interest of the restructured loan. So they are advised to pay their financial obligations on time to prevent an additional penalty of 0.5 percent per month,” Dooc said.
Members who took part in the program cannot avail of future condonations, although they can apply for new loans six months after they have paid all their dues.
The SSS said it “hopes to implement the loan condonation program regularly with the approval of its proposed charter amendments.”
“One of the provisions of the proposed bill is to rationalize the power of the Social Security Commission, which includes making it an approving authority for loan condonation programs instead of the President of the Republic of the Philippines,” it noted.