Policy, purpose, and operational objective
- The program is designed to provide member-focused loan services through enhanced loan terms and clarified implementation.
- The guidelines provide for the reinforcement of BR No. 203 and the uniform implementation of the Enhanced GSIS Conso-Loan Plus Program.
- The program includes rules that: consolidate eligible GSIS loans, standardize processing, and clarify payment, interest, insurance, fees, renewal, and default consequences.
- The enhanced program is backed by compliance with Republic Act No. 3765 (Truth in Lending Act) through clarified disclosure of interest charges.
Key legal framework and prior rules
- The enhancements are issued to clarify provisions under BR No. 203 (11 December 2014) and operationalize its changes.
- Earlier implementing issuances on the Conso-Loan Plus program are superseded by the new enhanced program guidelines.
- The program’s background references issuance of BR No. 141 (18 October 2006) for the GSIS Consolidated Salary Loan (Conso-Loan) Program.
- The program’s prior enhancements also reference: BR No. 135 (05 August 2009), BR No. 129 (16 August 2012), BR No. 98 (26 September 2013), BR No. 134 (28 November 2013), and Office Order No. 227-14 (19 February 2014).
- The enhanced guidelines incorporate internal processing and operational mechanisms, including GW@PS kiosk processing and eCard crediting.
Definitions that control program rules
- Basic Monthly Salary (BMS) means the fixed amount paid to an employee by an employer in return for work within a given month.
- Date of Loan Granting means the date when the loan header created in the GSIS IT system corresponds to the loan availed.
- Up-to-date Account is a loan account with consistently paid correct monthly amortizations and an outstanding balance equal to or less than the theoretical balance.
- Account in arrears means unpaid amortizations equivalent to six (6) months or less.
- Account default means arrearages more than the total monthly amortizations for six (6) months.
- Theoretical Balance means the loan balance if all monthly amortizations due were paid according to the payment plan/amortization schedule.
- Outstanding Balance means the sum of unpaid balance at the end of the month prior to loan renewal, including penalties and surcharges, if any.
- Permanent Regular Members are members appointed to a permanent position or elected to a position and required by law to remit regular monthly contributions.
- Non-Permanent Regular Members are members whose employment is co-terminous, confidential, contractual, casual, or emergency, but required by law to remit regular monthly contributions.
Who may borrow; how to apply; processing
- Qualified borrowers are active regular members and special members tagged in their Memberas Service Profiles (MSPs), provided they (1) have no pending administrative case and/or criminal charge, and (2) have paid and remitted at least three (3) monthly premium contributions for both Personal Share and Government Share within the last six (6) months prior to application.
- Employees of agencies tagged as “suspended” are not qualified; lifting of suspension restores loan privileges upon restoration of status.
- Applications are done personally through the GW@PS kiosk; over-the-counter application in any GSIS office is allowed only when kiosk application is not possible.
- Over-the-counter application must be personally done by the member-borrower using a properly accomplished application form and submitting a copy of the eCard or UMID eCard.
- Electronic certification is mandatory: Agency Authorized Officers (AAOs) must certify loan applications through the “aSecured On-Line Loan Certification Modulea” before processing.
- AAO certification must state that the member is in active service, has no pending administrative/criminal case, supplied information is true and correct based on agency records, is not on leave of absence without pay, and has net take-home pay still within General Appropriations Act minimum net take-home pay requirements after deduction of the monthly amortization; it must also state that amortization will be deducted from monthly salary.
- Only applications certified by the AAO within seven (7) calendar days are processed; applications not acted upon within seven (7) calendar days are cancelled and the member is informed via e-mail.
Loan consolidation, amounts, billing, interest, insurance, fees
- The Enhanced GSIS Conso-Loan Plus consolidates: Salary Loan, Restructured Salary Loan, Enhanced Salary Loan, Emergency Loan Assistance, and Summer One-Month Salary Loan.
- Consolidation results in full liquidation of outstanding balances of the above loans; outstanding balances including penalties and surcharges (if any) are computed up to the date of granting and waived upon first approval.
- Waiver of penalties and surcharges for first availment: outstanding penalties and surcharges of the consolidated loans are deemed waived upon approval.
- The minimum loanable amount is PHP 15,000.00.
- The maximum loanable amount for regular active members depends on PPP and computed BMS based on actual premiums posted, using the following table:
- > 20 months: 3 x BMS
- > 40 months: 4 x BMS
- > 5 years: 7 x BMS
- > 10 years: 10 x BMS
- > 15 years: 12 x BMS
- > 25 years: 14 x BMS
- The minimum loan amount to cover advance deductions and required fees must be 105% of the outstanding balances (Outstanding Balance x 105%); if the prescribed maximum is lower than 105%, the loan amount is set at 105% of the outstanding balance.
- For Judges and Justices, the loanable amount defaults to 10 months of BMS; for other special members, the loanable amount defaults to 10 months of BMS subject to execution of a memorandum of agreement (MOA) with GSIS.
- For first-time borrowers, the member chooses the amount and corresponding loan term based on PPP.
- For consolidation and loan renewal, members may choose a lower loan amount if loan proceeds sufficiently cover aggregate balances for existing loan accounts including charged fees.
- If the member does not indicate a preferred loan amount, the application is deemed for the maximum loan amount qualified by the member.
- Due date of first monthly amortization: amortization due is on or before the 10th day of each month following the due month until fully paid.
- For loans granted on or before the 23rd day of the month: the first due month is the calendar month immediately following loan granting; remittance deadline to GSIS is the 10th day of the following month.
- For loans granted after the 23rd day of the month: the first due month is the 2nd calendar month following loan granting; remittance deadline is the 10th day of the following month.
- The program requires pro-rata charging of interest computed from loan granting up to the end of the month when the loan was granted, and it uses advance interest deductions from loan proceeds.
- Interest rate is 12% per annum, compounded annually based on a diminishing balance.
- Advance interest deduction (lDA) applies to pro-rata interest from date of loan granting (or renewal date) up to the end of the month prior to the first due month, and the advance deduction is determined through the specified computation rules for first grant and renewal timing.
- Redemption insurance (RI) applies during the term to cover the member’s untimely death; RI is subject to a monthly RI rate depending on loan term:
- 1 year to pay: 0.29 per Php 1,000 of loan amount
- 2 years to pay: 0.30
- 3 years to pay: 0.32
- 4 years to pay: 0.34
- 5 years to pay: 0.36
- 6 years to pay: 0.38
- 7 years to pay: 0.40
- 8 years to pay: 0.42
- 9 years to pay: 0.44
- 10 years to pay: 0.46
- An advance RI premium is deducted from loan proceeds to ensure coverage from loan granting:
- If loan granted on or before the 23rd of the month: equivalent to 1 month
- If loan granted after the 23rd of the month: equivalent to 2 months
- If the member dies and the loan is up to date, the loan is deemed fully paid by RI coverage.
- If the loan is in arrears, RI covers only the theoretical outstanding balance; arrearages are deducted from benefits due the deceased.
- If arrearages exceed benefits due the deceased, the excess is deducted from subsequent benefits due the heirs.
- If the loan is in default, RI coverage is deemed lapsed/cancelled; the outstanding balance at death becomes due and demandable and is deducted from benefits due the deceased; if outstanding balance exceeds benefits, the excess is collected from subsequent benefits due the heirs.
- No RI premiums are collected from benefits that the deceased member and legal heirs are entitled to.
- RI automatically terminates when the member pays the loan in full or upon expiration of the loan term, whichever comes first.
- Fees charged upon loan granting are:
- Service Fee: 1% of the incremental gross loan amount (difference between loan amount and outstanding balances of existing loans consolidated), before insurance and fees.
- Renewal Fee: 1% of outstanding balance of consolidated loans; and
- eProcessing Fee: PHP 50.00.
- Net proceeds are computed by deducting from the loan amount the outstanding balances of consolidated/old conso-loan, advance RI premium, advance interest/IDA, service fee (1% of incremental gross loan amount), renewal fee (1% of outstanding balance), and eProcessing fee (PHP 50.00), after which proceeds are subject to deduction of loan arrearages when applicable.
Loan terms, amortization, e-crediting, and payment rules
- Maximum loan term depends on member category and PPP:
- Permanent regular members: 6 years if PPP is less than 10 years; 10 years if PPP is at least 10 years.
- Non-permanent regular members: 2 years if PPP is less than 10 years; 6 years if PPP is at least 10 years.
- Special members (Judges and Justices): 10 years.
- Other special members: 10 years subject to execution of an MOA.
- Members may choose a shorter payment term in increments of one (1) year or 12 months; failure to indicate payment term is interpreted as preference for the longest term qualified.
- Monthly amortization is computed as:
- MA = (Loan Amount + Monthly RI Premium) / Annuity Factor
- The annuity factor depends on specified formula inputs where r = (1+12%)^(1/12) - 1 and n is the number of paying periods in months.
- A tentative computation is provided in the GW@PS kiosk upon loan application; if actual net loan proceeds differ, GSIS informs the AAO and the member of adjustments through e-mail.
- Loan proceeds are directly credited to the member’s eCard account.
- The AAO and the member are informed of loan crediting through e-mail.
- Monthly amortization is paid through payroll deduction.
- Central/branch/extension offices handle payroll deduction mechanics through weekly and monthly notices, and they must monitor and inform parties when repayments stop or accounts are not yet fully paid.
- Accounts with outstanding balance equal to or less than PHP 10.00 are automatically tagged as “fully paid.”
- Tagging of fully paid accounts is done by an authorized officer when done through direct payment, CLASP, or payroll deduction.
- Members must directly remit installments when: the member is excluded from monthly collection list; the member is on secondment or study leave without pay or extended leave without pay; the agency fails to deduct/remit amortization; or payroll deductions are insufficient.
- The order of application of payments is: (a) Redemption Insurance premium, (b) Principal, (c) Interest, (d) Penalty.
- When in arrears, the “move-upa policy” applies: payments are applied first to the earliest unpaid month until the month’s full amount due is fully collected.
- Lumped repayments distributed in the ERF are distributed accordingly and moved-up as appropriate.
- Otherwise, the amount due for the subject month is satisfied first, and remaining amounts are applied as advance payment to principal.
- Payments pertaining to loans already consolidated or renewed are automatically applied as advance payment to principal of the existing loan.
- If there is delayed posting of an earlier payment, the system applies it to the earliest open item consistent with the move-up policy.
Renewal, pre-termination, cancellation limits, and compulsory pre-termination
- Enhanced GSIS Conso-Loan Plus may be renewed any time as long as there are net proceeds on renewal after deducting outstanding balances of the previous Conso-Loan and other loans enumerated under the consolidation rule.
- Renewal rules for problematic accounts:
- If an account is in arrears upon renewal, it is charged interest.
- If an account is in arrears upon renewal, it incurs a penalty of 1% per month, compounded monthly, until the arrears are paid.
- If an account is in default upon renewal, it incurs a penalty of 6% per annum, compounded monthly.
- The penalty forms part of the outstanding balance deductible from renewal proceeds.
- The loan may be pre-terminated by paying the outstanding balance before the end of the loan term.
- Once credited to the eCard, the member has no option to cancel the loan but may only pre-terminate without any right to demand reimbursement of fees.
- The loan agreement is deemed pre-terminated upon death, resignation, permanent disability, retirement, or separation from service.
- Upon such compulsory pre-termination, the outstanding balance becomes due and demandable and is collected from claims of members or heirs or through other administrative or civil courses of action.
- Retiring members may avail of Choice of Loan Amortization Schedule for Pensioners (CLASP) subject to existing policies and procedures.
Default, recovery, and refund mechanics
- In event of default, the outstanding balance becomes due and demandable without need of demand or further notice, and the member expressly waives demand or further notice.
- If full payment is not made after default, the outstanding balance is charged:
- Interest equivalent to 12% per annum compounded monthly (pacm), and
- Penalty of 6% pacm,
from the date of default until full payment.
- GSIS may recover by any legal means possible any amount credited in the eCard account due to fraud, misrepresentation, or error on any transaction involving the member.
- At the end of the loan term, any overpayment is treated under the policy guidelines on treatment of excess payment.
- GSIS uses specified pro-forma accounting entries for different transactions, including adjustments in application of payment, and Controller Group provides such entries.
- ITSG provides monthly reporting facilities for monitoring purposes for Operations Groups, CPO, Internal Audit Services Office, Controller Group, and Financial Management Group.
Implementation support, documentation, and effectivity
- The Corporate Communications Office prepares information materials to disseminate the program guidelines.
- ITSG provides computer services support and automation enhancements to implement loan granting and payment systems and generation of reports.
- The Manual of Operations for affected FG processes, including branch offices, is updated to reflect program guidelines.
- Operations Groups, in coordination with Legal Services Group, prepare and submit revised Terms and Conditions and the loan application form to ITSG and CPO, respectively.
- The enhanced guidelines supersede PPG No. 201-09 on the GSIS Consolidated Salary Loan Plus Program and its subsequent amendments.
- The enhanced guidelines take effect immediately.