GFAL temporarily suspended due to COVID-19
State pension fund Government Service Insurance System (GSIS) announced plans to extend GFAL (GSIS Financial Assistance Loan) for its members who have existing loans with lending institutions until the end of September this year. The program was originally scheduled to end in July 2020.
In this regard, GSIS will temporarily stop accepting loan applications for GFAL effective 14 March 2020 not only in its Head Office in Pasay City, but in all GSIS branch offices nationwide.
“We assure our members that those who were not able to avail of GFAL can always apply at a later date since we will extend the program until 30 September 2020,” GSIS President and General Manager (PGM) Rolando Ledesma Macasaet said.
Macasaet also stressed that all GFAL applications that were submitted to GSIS branch offices on or before 13 March 2020 will be duly processed and acted upon by GSIS personnel.
He pointed out that the temporary suspension aims to discourage GSIS members from going to the pension fund’s branch offices, in compliance with President Duterte’s directive to minimize human-to-human contact, and contain the spread of the COVID-19 virus.
The pension fund chief said that aside from the submission of loan documents, GSIS requires all GFAL applicants to attend a financial literacy and loan counselling seminar as a prerequisite to loan approval. “GSIS cannot be conducting financial literacy seminars with the current emergency situation we have,” he added.
Under the GFAL program, government employees can transfer their loans from private lending institutions (PLIs) to GSIS, at a lower interest rate of 6% and longer payment term of six years.
The program is GSIS’s response to President Duterte’s call to put an end to high-interest money lending schemes (such as ‘5-6’) that leave government workers cash-strapped and wedged deeper into debts.
Since it was launched in May last year, GSIS has already released a total of Php93.5 billion in GFAL loans to about 230,000 government employees nationwide.
“We are closely monitoring the situation and will be issuing further advisories. But for now, all GFAL activities nationwide are effectively suspended until further notice. As I repeatedly said the safety and well-being of our stakeholders is our primordial concern,” Macasaet said.