MANILA, Philippines — State-run Government Service Insurance System (GSIS) has urged its members to settle their past due loan accounts until Sept. 30 this year to avoid penalty and charges.
GSIS president and general manager Jesus Clint Aranas said the state pension fund would discontinue waiving penalties and surcharges on overdue loans starting Oct. 1.
According to Aranas, GSIS is currently not collecting penalties and surcharges on past due loan accounts if the member is in active service.
Aranas said over the long term, the automatic waiver would compound the fund’s forgone interest income, and eventually be disadvantageous to the social insurance fund.
“Thus, GSIS will discontinue this waiver of penalties and surcharges starting Oct.1 this year,” the state fund said.
To settle their overdue loans, Aranas said members could avail of the Enhanced Conso-loan Plus program, which waives all penalties and surcharges on existing salary loan accounts, including additional interests.
“We are extending the restructuring scheme under the Enhanced Conso-loan Plus because we want you, our members, to ease your financial burdens and help you enjoy your full benefits when you retire. But we need to impose a deadline because, in the final analysis, you have to keep your correct monthly amortization and pay off your loans on time,” Aranas said.
Under the Enhanced Conso-loan Plus program, members who have paid premium contributions for at least 15 years may borrow a 12-month salary loan while those with at least 25 years of paid premiums will be eligible for a 14-month loan.
Borrowers can pay this loan until a maximum of 10 years, provided that they have paid contributions of at least 10 years.