The state-run pension fund Government Service Insurance System has made available a loan facility under which teachers and personnel of the Department of Education can pay their obligations to private lenders.
The GSIS, led by general manager Jesus Clint Aranas, and Education Secretary Leonor Briones signed the memorandum of agreement for the financial assistance loan program last Monday, witnessed by no less than President Duterte.
“We don’t want DepEd employees to sink deep into debt so we have proposed a better way for them to manage their finances. The borrowers will pay back the loan to GSIS at easy and affordable terms,” Aranas said in a statement.
“Having several loans weakens the employees’ capability to settle their obligations, which include payment of their monthly GSIS premiums and contributions. Payment of their GSIS premiums and loans usually take a back seat. If the practice continues, their future GSIS benefits are bound to suffer,” Aranas noted.
Under the loan facility, qualified members can borrow up to P500,000 as long as their monthly take-home pay will not be less than P5,000 upon deduction of their outstanding obligations.
“The loan is payable in monthly instalments for six years at 6-percent interest rate [a year] computed in advance. Payments will be automatically deducted from the borrower’s salary,” the GSIS said.
“Active GSIS regular members may apply for the loan if they are permanent; with paid premiums for the last three years; are not on leave of absence without pay; have an outstanding loan with DepEd-accredited private lending institutions; have no due and demandable GSIS loan, and have no pending administrative or criminal case,” it added.
This program will be piloted for six months in the following areas: Batangas, Bulacan, Dagupan, Naga, Cavite, Manila, Quezon City, Bohol, Ormoc, Koronadal, Butuan and Tagum.