30-day ‍moratorium ‍on loan payments OK’d | Inquirer Business

30-day ‍moratorium ‍on loan payments OK’d

By: - Reporter / @bendeveraINQ
/ 05:32 AM April 02, 2020

Borrowers from public and private lenders have been given a 30-day moratorium under the Bayanihan to Heal as One Act, for loan principal and/or interest that fall due from March 17 to April 12, when Luzon and other parts of the country were put under enhanced community quarantine (ECQ).

Covered under the implementing rules and regulations of Republic Act No. 11469, are loans from banks, quasibanks, nonstock savings and loan associations, credit card issuers, pawnshops, as well as the state-run Pag-Ibig Fund, and pension funds Government Service Insurance System and Social Security System, among other regulated credit-granting financial institutions.

Also on Wednesday, the Department of Finance (DOF) and the Department of Budget and Management (DBM) said they would tap unused funds from state-run corporations and national government agencies for COVID-19 response.


Finance Secretary Carlos Dominguez III said the 30-day grace period covered all loans—including multiple loans of individuals and entities—and would be implemented nationwide.


Under this temporary loan relief, institutions cannot slap interest on interest, fees and other charges, nor on future payments or amortization whether for individuals; households; micro, small and medium enterprises; corporate borrowers; and other counterparties.

Payments of documentary stamp tax usually slapped on loan agreements were also waived, including those imposed on credit extensions and credit restructuring, microlending including those obtained from pawnshops, and extensions given during the quarantine period.

As for accrued interest, these “may be paid by the borrower on staggered basis over the remaining life of the loan,” even as payment in full on the new date following the 30-day grace period will be up to the borrowers if they can afford to do so.

Institutions were also prohibited from requiring clients to waive application of the loan moratorium program, including those with previously executed waivers for payments due during the quarantine period.

The moratorium period would automatically be extended should the government extend the ECQ.

On Monday, Dominguez and Budget Secretary Wendel Avisado separately issued Joint DOF-DBM Circular No. 1, to implement Section 4(y) of RA 11469, that authorized the President to “allocate cash, funds, investments, including unutilized or unreleased subsidies and transfers, held by any government-owned or -controlled corporation or any national government agency, in order to address the COVID-19 emergency.”


The DBM has asked departments implementing COVID-19 response measures to submit special budget requests so that the budget agency can issue special allotment release orders and notices of cash allocation to disburse the pooled funds.

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