Title
Amended Guidelines for Modified Pag-IBIG II Program
Law
Circular No. 407
Decision Date
Jul 11, 2018
The Amended Guidelines for the Modified Pag-IBIG II (MP2) Membership Program introduce a voluntary savings scheme for Pag-IBIG I members and pensioners, offering higher dividend rates, flexible contribution options, and provisions for pre-termination under specific circumstances.
membership
savings
guidelines

Basis, authorization, and governance approval

  • The circular is issued pursuant to approval of the Pag-IBIG Fund Board of Trustees on its 2018-03 Board Meeting held on April 19, 2018.
  • The circular governs interpretation and implementation through resolution by concerned officers, with escalation when issues remain unresolved (Section I).
  • The circular authorizes the Board of Trustees to approve matters such as “other meritorious grounds” for pre-termination (Sections E.1 and E.2).

Objectives and program purpose

  • The guidelines aim to provide flexibility and convenience in managing members’ savings with the Fund (Section A).
  • The guidelines aim to allow members of a shorter savings scheme to obtain a yield higher than the existing Pag-IBIG Membership (Section A).
  • The MP2 Program is established as a savings scheme (Section H.2).

Who may join under MP2

  • Membership under the Modified Pag-IBIG II (MP2) Program is voluntary (Section B).
  • MP2 membership covers all Pag-IBIG I members, regardless of monthly income (Section B.1).
  • MP2 membership covers former Pag-IBIG I members with other sources of monthly income and Pensioners, regardless of age, provided they have at least 24 monthly savings prior to retirement (Section B.2).
  • “Pensioners” refers to persons receiving pension under named laws and issuances including Republic Act (RA) 8282, RA 8291, RA 660, RA 1616, RA 7699, Presidential Decree (PD) 1146, PD 1650, RA 8551, RA 9263, RA 9993, and RA 9946 (Section B).

Savings contributions and payment method

  • Members may contribute a minimum of PHP 500.00, recorded as of the payment date (Section C).
  • If a member makes a one-time contribution exceeding PHP 500,000.00, the payment must be made via personal or manager’s check (Section C).

Dividends, government guarantee, and dividend options

  • MP2 accounts opened under the amended guidelines receive flexible dividend rates higher than those of Pag-IBIG I (Section D.1).
  • Dividend rates are declared after net income is computed and approved by the Board of Trustees (Section D.1).
  • At the point of application, the member may opt for an annual dividend payout or compounding of dividends (Section D.2).
  • MP2 savings and dividends are government-guaranteed (Section D.3).
  • MP2 savings not claimed upon maturity cease to earn MP2 Program dividend rates (Section D.4).
  • For unclaimed maturity balances, subsequent dividends are based on the rates declared for Pag-IBIG I for the next two (2) years, after which the same are reclassified as payable accounts (Section D.4).

Pre-termination and withdrawal rules

  • Pre-termination or withdrawal of MP2 savings by Pag-IBIG I members prior to maturity is allowed only under the listed circumstances in Section E.1.
  • Pag-IBIG I members may pre-terminate for: total disability or insanity (E.1.1); separation from service due to health (E.1.2); death of the member or immediate family member (E.1.3); retirement (E.1.4); permanent departure from the country (E.1.5); distressed member due to unemployment limited to layoff and/or closure of company (E.1.6); critical illness of the member or immediate family member certified by a licensed physician and subject to DCEO–Member Services Cluster approval, for cancer, organ failure, heart-related illness, stroke, and neuromuscular-related illness (E.1.7.1–E.1.7.5); repatriation of an OFW member from host country (E.1.8); and other meritorious grounds approved by the Board (E.1.9) (Section E.1).
  • Pre-termination or withdrawal of MP2 savings by Pensioners prior to maturity is allowed only under the listed circumstances in Section E.2.
  • Pensioners may pre-terminate for: total disability or insanity (E.2.1); death of the member or immediate family member (E.2.2); permanent departure from the country (E.2.3); critical illness of the member or immediate family member certified by a licensed physician and subject to DCEO–Member Services Cluster approval, for cancer, organ failure, heart-related illness, stroke, and neuromuscular-related illness (E.2.4.1–E.2.4.5); and other meritorious grounds approved by the Board (E.2.5) (Section E.2).
  • If a member chooses compounding of dividends and pre-terminates for reasons other than those in Sections E.1 and E.2, the member receives 50% of the total dividend earned as penalty for the pre-termination (Section E.3).
  • If a member chooses annual dividend payout and pre-terminates for reasons other than those in Sections E.1 and E.2, the member receives his/her contributions (Section E.4).

Release of accumulated value and dividends

  • If the member opts for compounding of dividends, the member receives the Total Accumulated Value (TAV) at the end of the five (5) year MP2 membership term; the TAV comprises contributions and corresponding dividends (Section F.1).
  • If the member opts for annual dividend payout, the member receives annual dividends credited to the member’s savings or checking account from the Land Bank of the Philippines (LBP), Development Bank of the Philippines (DBP), and other banks accredited by the Fund; contributions are released at the end of the five (5) year membership term (Section F.2).
  • If an MP2 member with annual dividend payout has no Philippine bank account (especially overseas members), the dividends are treated as Accounts Payable withdrawable anytime (Section F.3).
  • If an MP2 member enrolled under Circular No. 276 chooses annual dividend payout, the member must pre-terminate the existing MP2 account and enroll under these guidelines (Section F.4).

Renewal, multiple accounts, and membership limitations

  • Upon MP2 maturity, continuation of MP2 requires the member to apply for a new MP2 account (Section G).
  • Multiple MP2 accounts are allowed, provided the member registers each account separately (Section H.1).
  • MP2 members are limited to the MP2 Program as a savings scheme and are not entitled to avail of the Fund’s lending programs unless the member is also an active member under Pag-IBIG I and satisfies the Fund’s eligibility criteria (Section H.2).
  • “Immediate Family Member” for purposes of the cited provisions on membership termination includes spouse, parents, children, siblings, grandparents, and grandchildren (Section H.3).
  • Legally adopted children are included only insofar as applications for withdrawal of savings of their adoptive mothers or adoptive fathers are concerned (Section H.3.7).

Issue resolution, repealing, and contraries

  • Issues on interpretation and implementation are resolved by the concerned officers as far as possible (Section I).
  • Matters not resolved satisfactorily are escalated to the next higher approving authority (Section I).
  • All memoranda, rules, regulations, and other issuances contrary to or inconsistent with the guidelines are repealed, amended, or modified accordingly (Section J).

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