More than 2,500 members of the Government Service Insurance System can now settle their loan obligations with zero penalties and surcharges after the Governing Board approved Thursday the condonation of outstanding balances under the Stock Purchase Loan (SPL) program.
SPL accounts paid on or before June 30, 2011 will enjoy 100 percent condonation on penalties and surcharges and a 50 percent condonation on interest. Stock Certificates will also be released upon full payment.
Shares of stocks of unsettled loan accounts after the June 30 deadline will be sold and the proceeds applied to the loan balances.
The new program forms part of the initiatives of the Board’s continuing review of all plans and programs to make them friendlier for its members and pensioners.
“We want those who have outstanding SPL accounts to have zero liabilities so they can enjoy their retirement benefits in full,” said Robert G. Vergara, GSIS President and General Manager.
Vergara explained the condonation program will also allow the GSIS to clean up its records and unload non-performing loans.
In 1994, the GSIS introduced the Stock Purchase Financing Program (SPFP), in which an active member can apply for a loan equivalent to five times his monthly basic salary or such amount which can be amortized by his monthly paying capacity but not to exceed P100,000.00. A pensioner is entitled to a loan equivalent to six times his monthly pension but not more than P10,000.00.
Members and pensioners who availed of the SPL Program can repay their loans through sale of stocks, cash payment before maturity and deduction from any benefit due the member or pensioner in view of his separation or retirement from the service or death.
In case of separation or retirement from the service of an active member, the outstanding balance of the loan shall become due and demandable and shall be deducted from any benefit due the member.
As of December last year, a total of 2,596 members have outstanding stock purchase loan obligations valued at P273 million.
For inquiries about the SPL condonation program, concerned members may visit the frontline services units in any GSIS office or call the GSIS hotline at 479.3645