Unpaid loans can lead to a cascade of financial repercussions, often exacerbated by accumulating penalties and interest.
For many individuals, particularly those availing of short-term member loans, navigating through these penalties can become overwhelming, leading to a cycle of debt.
However, Social Security System (SSS) Executive Vice President for Investments Sector Rizaldy T. Capulong urged members with unpaid short-term member loans to avail of the Consolidation of Past Due Short-Term Member Loans with Condonation of Penalty (Conso Loan), wherein SSS will waive the penalties of their unpaid loans.
One of the things they are listening to their members' cries for is to provide a loan forgiveness program for people with past-due balances.
Under the Conso Loan program, SSS would consolidate all past-due short-term member loans, including principle and interest, into a single consolidated loan.
All outstanding penalties will also be merged and will be forgiven or waived upon complete repayment of the aggregated loan.
Participants in the Salary Loan Early Renewal Program (SLERP) and other restructured loans, as well as those with outstanding loan commitments related to their salary, are eligible to participate in the program.
They want to convince their members who owe money to take advantage of this chance to pay off their past-due debts with no penalties by using a simple payment plan.
They started this program to help their members who are having trouble paying back their loans to the SSS. As long as the program is in place, this deal is valid.
In order to be eligible for the program, prospective participants must fulfill the following requirements:
- have a past-due short-term member loan at the time of their application;
- have not been granted any final benefit such as permanent total disability or retirement;
- have not been disqualified due to fraud committed against the SSS; and
- have an active My.SSS account.
Members may submit their application for the Conso Loan program online through their My.SSS account.
Members may pay their consolidated loan through a one-time payment within thirty (30) calendar days after receiving the approval notice, or they may also opt to pay through installment.
For the installment scheme, members must pay a down payment equivalent to at least 10% of the consolidated loan within thirty (30) calendar days after receiving the approval notice.
Meanwhile, they can pay the remaining balance for up to 60 months, wherein the length of the installment term depends on the amount of the unpaid loan.
If the member fails to meet the payment terms based on the consolidated loan agreement, SSS will deduct the outstanding balance of the consolidated loan from the short-term benefits (sickness, maternity, or partial disability benefit claims) and final benefits (permanent total disability, death, retirement), as authorized by the Social Security Commission (SSC).
Outstanding balance of the consolidated loan can also be deducted from the death benefit of the members’ beneficiaries or deducted from the actual final benefit claims.
As of December 2023, more than half a million members has availed of the Conso Loan program and SSS has already condoned more than P7.3 billion loan penalties.
Source: Social Security System
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