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SSS Salary Loan

What is a salary loan?
It is a loan intended to meet a member's short-termcredit needs.


Who may qualify for a salary loan?

  • An employed, currently paying self-employed or voluntary member (SE/VM) who has 6 posted monthly contributions for the last 12 months prior to the month of filing of application.
  1. For one-month loan, the member-borrower must have 36 posted monthly contributions prior to the month of  filing of application.
  2. For a two-month loan, the member-borrower must have 72 posted monthly contributions prior to the month of filing of application.
  • If the member-borrower is employed, the employer must be updated in contributions and loan remittances.
  • The member-borrower must be updated-current in the payment of other member loans, which include educational, stock investment, MADE & housing loans granted under the Unified Housing Loan program (UHLP) or direct from SSS.
  • The member-borrower has not been granted final benefit (total permanent disability, retirement and death).
  • The member-borrower has not been disqualified due to fraud committed against the SSS.


How much is the loanable amount?
A one-month salary loan is equivalent to the average of the member’s latest 12 monthly credits posted.

A two-month salary loan is equivalent to twice the average of the member’s latest 12 monthly salary credits posted (rounded to the next higher monthly salary credit), but not to exceed P24,000.


How long will it take the member to pay back the loan?

The one-month or two-month salary loan shall be payable within two (2) years in 24 equal monthly installments.

How much is the interest charged on a salary loan?
The loan shall be charged a nominal interest of 10% per annum. First year’s interest shall be deducted in advance from the proceeds of the loan. Second year’s interest shall be included in the monthly amortizations.

In case a loan is not paid, how much is the delinquency interest?
Loan amortization not remitted on due date shall bear a penalty of 1% per month.

Is there a service fee?
Yes. A service fee of 1% of the loan amount shall be charged and deducted from the proceeds of the loan.
 

When can a member renew a salary loan with the SSS? The loan may be renewed after the prescribed amortization period of two (2) years. Balance of P500 or less shall be deducted from the proceeds of the new loan.

How does a member pay back the loan?

For employed member-borrower (including participants of the fast track program), the first deduction from their salaries shall start on the second month following the date of loan. All remittances shall be made on or before the 10th day following the applicable month of deduction to the SSS or to any of its authorized banks.

The employee is obliged to report to the new employer his obligations with SSS and shall allow the new employer to deduct from his salary the corresponding amortizations due, plus any penalty for late remittance of amortizations.

For self-employed or voluntary paying member-borrowers, the first amortization shall be paid to the SSS or any of its authorized banks on or before the 10th day of the third month following the date of loan.

What are the obligations of the employer to the SSS?
The employer shall be responsible for the collection and remittance to the SSS of the amortization(s) due on the member-borrower’s salary loan through payroll deduction.

The employer shall require new employees to secure from the SSS an updated statement of account.

The new employer shall continue the deduction and shall be accountable for remittance to the SSS.

I

n case of transfer, separation, or resignation, how can a borrower pay back the loan?
In case a 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 be required to deduct the total balance of the loan from any benefit(s) due to the employee and shall remit the same in full to SSS.

If the benefit(s) due the employee or the amount thereof legally available for offset of obligations of the employee is insufficient to fully repay the loan, the employer shall report the unpaid loan balance to SSS.

In case of member-borrower’s death, total disability or retirement, what happens to the unpaid loan?
In case of member’s’s death, total disability or retirement under the Social Security Act, the entire amount or any unpaid amount of the loan as well as the interest and penalty thereon, If any,shall be deducted from the corresponding benefit.

What are the papers/documents needed for filing a salary loan?

An employed member shall submitan accomplished SSS Form ISL-101 (Member Loan Application Revised March 2004) and present the digitized SSS ID cards or E-6 acknowledgement stub with 2 (2) IDs listed below one of which with recent photo and date of birth.

A self-employed, voluntary member, overseas worker, non-working spouse, farmer or fisherfolk and house hold-helper shall submit an accomplished SSS Form ISL-101 and present the digitized ID card or E-6 acknowledgement stub with any two (2) of the following valid IDs,one of which with recent photo and date of birth.

  • Unexpired Driver’s License
  • Professional Regulation Commission (PRC) ID Card
  • Passport
  • Postal ID
  • School or Company ID
  • Tax Identification Number Card (TIN)


Where can a borrower file the salary loan application?

A borrower may file the salary loan application at the nearest SSS branch or representative office.

NOTE:
The employer shall submit annually an updated SSS Form L-501 (Specimen Signature Card) to avoid delay in the processing of salary loan applications.

When can a member renew a salary loan with the SSS?
The loan may be renewed after the prescribed amortization period of two (2) years. Balance of P500 or less shall be deducted from the proceeds of the new loan.

How does a member pay back the loan?
For employed member-borrower (including participants of the fast track program), the first deduction from their salaries shall start on the second month following the date of loan. All remittances shall be made on or before the 10th day following the applicable month of deduction to the SSS or to any of its authorized banks.

The employee is obliged to report to the new employer his obligations with SSS and shall allow the new employer to deduct from his salary the corresponding amortizations due, plus any penalty for late remittance of amortizations.

For self-employed or voluntary paying member-borrowers, the first amortization shall be paid to the SSS or any of its authorized banks on or before the 10th day of the third month following the date of loan.

What are the obligations of the employer to the SSS?
The employer shall be responsible for the collection and remittance to the SSS of the amortization(s) due on the member-borrower’s salary loan through payroll deduction.

The employer shall require new employees to secure from the SSS an updated statement of account.

The new employer shall continue the deduction and shall be accountable for remittance to the SSS.

In case of transfer, separation, or resignation, how can a borrower pay back the loan?
In case a 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 be required to deduct the total balance of the loan from any benefit(s) due to the employee and shall remit the same in full to SSS.

If the benefit(s) due the employee or the amount thereof legally available for offset of obligations of the employee is insufficient to fully repay the loan, the employer shall report the unpaid loan balance to SSS.

In case of member-borrower’s death, total disability or retirement, what happens to the unpaid loan?
In case of member’s’s death, total disability or retirement under the Social Security Act, the entire amount or any unpaid amount of the loan as well as the interest and penalty thereon, If any,shall be deducted from the corresponding benefit.

What are the papers/documents needed for filing a salary loan?
An employed member shall submitan accomplished SSS Form ISL-101 (Member Loan Application Revised March 2004) and present the digitized SSS ID cards or E-6 acknowledgement stub with 2 (2) IDs listed below one of which with recent photo and date of birth.

A self-employed, voluntary member, overseas worker, non-working spouse, farmer or fisherfolk and house hold-helper shall submit an accomplished SSS Form ISL-101 and present the digitized ID card or E-6 acknowledgement stub with any two (2) of the following valid IDs,one of which with recent photo and date of birth.

  • Unexpired Driver’s License
  • Professional Regulation Commission (PRC) ID Card
  • Passport
  • Postal ID
  • School or Company ID
  • Tax Identification Number Card (TIN)


Where can a borrower file the salary loan application?
A borrower may file the salary loan application at the nearest SSS branch or representative office.

NOTE:
The employer shall submit annually an updated SSS Form L-501 (Specimen Signature Card) to avoid delay in the processing of salary loan applications.



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