Are you are a member of SSS? Do you know about the salary loan that you can avail? This article will be tackling all about the SSS Salary Loan.
It is a cash loan for to an employed, currently paying self-employed or voluntary member. It is intended to meet the member’s short term credit needs.
Who can avail?
- All currently employed, currently, contributing self-employed, or voluntary member can avail.
For a one-month salary loan, you should have 36 posted monthly contributions, 6 of which should be within the 12 months before the filing of your application.
While for a two-month salary loan, posted monthly contribution of 72 months, 6 of which should be within 12 months prior to your application.
- Your employer must be updated in the payment of contributions (if you are employed).
- You must not be granted final benefit (Total Permanent Disability, Retirement, Death).
- Applicant must be under 65 years of age at the time of filing the application.
- Have not been disqualified due to fraud commitment against SSS.
The amount you can loan
- A one-month salary loan is equivalent to the average of the member borrowers latest posted 12 Monthly Salary Credits (MSCs), or amount applied for, whichever is lower.
- A two-month salary loan is equivalent to twice the average of the member borrowers latest posted 12 MSCs, rounded to the next higher monthly salary credit, or amount applied for, whichever is lower.
- The net amount of the loan shall be the difference between the approved loan amount and all outstanding balance of short-term member loans.
Repayment Terms and Schedule of Payment
- The loan shall be payable within two (2) years in 24 monthly installments.
- The monthly amortization shall start on 2nd month following the date of the loan.
Self-employed and Voluntary Members
Payment shall be made at any SSS branch with tellering facility, SSS-accredited bank or SSS-authorized payment center.
Let your employer know about the loan. The employer will deduct the amount to your salary.
Interest and Penalty
- The loan shall be charged an interest rate of 10% per annum based on diminishing principal balance, and shall be amortized over a period of 24 months.
- The interest of 10% shall continue to be charged on the outstanding principal balance until fully paid.
- Any excess in the amortization payment shall be applied to the outstanding principal balance.
- Loan amortization not remitted on the due date shall bear a penalty of 1% per month until the loan is fully paid.
A service fee of 1% of the loan amount shall be charged and deducted from the proceeds of the loan.
- Renewal shall be allowed after payment of at least 50% of the original principal amount and at least 50% of the term has lapsed.
- Proceeds of renewal loan is any amount greater than or equal to zero as long as the outstanding balance on the previous loan is deducted.
RESPONSIBILITIES OF EMPLOYER
- The employer shall be responsible for the collection and remittance to the SSS of the amortization due on the member-borrowers salary loan through payroll deduction.
- The employer shall deduct the total balance of the loan from any benefit/s due to the employee and shall remit the same in full to SSS, in case the member-borrower is separated voluntarily (e.g., retirement or resignation) or involuntarily (e.g., termination of employment or cessation of operations of the company).
- The employer shall report to the SSS the effective date of separation from the company and the unpaid loan balance of the employee, through the collection list, if the benefit(s) due the employee is insufficient to fully repay his loan.
- The employer shall require a new employee to secure from the SSS an updated statement of his account.
- The employer shall deduct and remit to SSS any outstanding loan balance of new employees.
RESPONSIBILITY OF MEMBER-BORROWER
A member-borrower who transfers employment shall submit to his new employer an updated statement of account of any outstanding loan balance with SSS and allow his employer to deduct from his salary the corresponding amortization due, including any interest/or penalty for late remittance.
DEDUCTION OF UNPAID LOAN FROM BENEFITS
In case of default, the arrearages/unpaid loan shall be deducted from the benefits claimed by the member, whichever comes first, as follows;
- For self-employed/voluntary member, deduction shall be from short-term benefits (Sickness/Maternity/Partial Disability).
- In case of member borrowers death, total disability or retirement under Social Security Act, the entire amount or any of unpaid amount of the loan as well as the interest and penalty thereon, if any, shall be deducted from the corresponding benefit.
How to apply
A borrower may file the salary loan application at the branch nearest the place of residence or business. A member who is registered at My.SSS can submit the salary loan application online.
The salary loan submitted online by an employed member will be directed to the employer’s My.SSS account for certification, hence, the employer should also have an SSS Web account.
OFW members may also file their salary loan application at the SSS Foreign Representative Offices in selected countries. In case there is no SSS office in a particular country they may send their application and supporting documents to their relatives here in the Philippines and authorize them to file at the SSS branch.
Documents issued in other country should be duly authenticated or certified by the Philippine Consulate Embassy.
Note: The employer shall submit an updated Specimen Signature Card (SS Form L-501) to be updated annually to avoid delay in the processing of salary loan applications.
If filed by the applicant herself
- Member Loan Application Form
- SSS digitized ID or E-6 (acknowledgment stub) with any two valid IDs, one of which with a recent photo.
If filed by Member-borrower’s Authorized Representative
- Member-borrower’s duly accomplished Member Loan Application
- Authorized Representative’s SS card or any two valid IDs both with signature and at least one with photo
- Letter of Authority (LOA) signed by both the member-borrower and member-borrower’s authorized representative
- Member-borrower’s SS card or any two valid IDs both with signature and at least one with photo.
For more information, you can contact:
SSS Call Center: 920-6446 to 55
Toll-Free No.: 1-800-10-2255777