EXPLAINER: What is the SSS microloan, and how can you apply for it?

Private sector workers’ pension fund Social Security System (SSS) has launched an initiative to extend short-term cash loans to provide immediate financial relief for its members.

This is the SSS Micro Loan Program, also known as SSS LoanLite.

It is a short-term microloan facility designed to provide qualified SSS members with accessible, secure, and affordable financial assistance for immediate needs such as emergency expenses, medical needs, educational costs, home essentials, and small business support, among others.

The loan lite is intended to be accessed through the digital platform or mobile app of the Participating Financial Institutions (PFIs).

Participating banks

Among Phase 1 implementation partners of the program include UnionDigital Bank, Rizal Commercial Banking Corporation (RCBC) through its DiskarTech app, the Land Bank of the Philippines, and Union Bank of the Philippines.

The micro loan program’s key features are as follows:

• Loanable amount: P1,000 to P20,000, depending on the member's average 12 latest Monthly Salary Credit (MSC) and applicable program guidelines
• Repayment period: 15, 30, 60, or 90 days
• Interest rate: 8% per annum, equivalent to approximately 0.67% per month
• Digital access: The application and related transactions are intended to be facilitated through the digital platform of the participating financial institution with the loan proceeds credited directly to the borrower’s account with the participating financial institution.
• No employer certification required

Are you eligible?

The micro loan is open to eligible employed, self-employed, voluntary, and OFW members.

To qualify for a member must be at least 18 years old at the time of application and below 65 years old at the end of the loan term.

Moreover, a must must have at least 12 posted monthly contributions, have no past due short-term member loan, no pending or settled final benefit claim (such as retirement or permanent total disability), no active Restructured Loan, and have no record of fraud against SSS.

A loan lite application must also have an account enrolled in the online facility of a participating bank or financial institution.

How to apply?

Interested borrowers only need to access the mobile app or online facility of the participating financial institution and select “SSS LoanLite” or “SSS Micro Loan.”

The next step is to enter the SS Number and view loan eligibility, maximum loanable amount, and available repayment term before selecting the desired loan amount and repayment term.

Loan lite applicants must agree to the required disclosures, terms and conditions, certifications, and consent statements before submitting application and wait for approval and crediting of loan proceeds.

Other charges include:

• A maximum of P200.00 per loan transaction plus add-on fee not exceeding 3% per annum of the loan amount shall be deducted from the loan proceeds as fees for the services of the participating financial institution
• For any unpaid loan after the term, continuing interests and penalties shall be charged on the outstanding principal balance until fully paid

No other fees related to the loan shall be charged by the participating financial institution to the member-borrower.

How it works

The participating financial institution is the one facilitating the application, credit evaluation, approval, and disbursement processes in accordance with the program's approved guidelines.

Upon approval, the loan proceeds will be credited through the applicable account with the participating financial institution.

Repayments will be collected as scheduled by the participating financial institution, through automatic-debit-arrangement or its default collection mode, mainly from the account where the loan proceeds were credited.

The pension fund advised members to review the loan disclosure statement, including the applicable interest, fees, repayment schedule, and other terms, before accepting the loan.

Loan renewal is allowed after full payment of the current microloan, as reported by the participating financial institution. — BM, GMA News