MANILA, Philippines - The Social Security System (SSS) is offering options for members who have failed to pay their loans.
The SSS said members with outstanding loans under the Stock Investment Loan Program (SILP) and the Privatization Fund Loan Program (PFLP) can avail of an option to sell their shares of stocks under the two programs.
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"Despite loan condonation programs that we have offered in the past, there are still quite a number of SSS members who have let their unpaid SILP and PFLP loans balloon into staggering amounts due to penalties and interest," said SSS Senior Vice President and concurrent Officer-In-Charge for Lending and Asset Management May Catherine Ciriaco.
The SSS said as of 31 December 2014, there are 3,037 delinquent SILP loan accounts with a total of P304.44 million, inclusive of penalties and interest.
There are also 5,755 delinquent PFLP loan accounts, reaching P304.19 million with penalties and interest.
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In September 2014, the Social Security Commission approved the option to sell shares of stocks, as a way to lessen these delinquent accounts.
Under the option to sell shares, the member-borrower will execute a Special Power of Attorney authorizing the SSS to sell his shares of stocks at the prevailing market price, based on the quotation of an accredited broker and subject to the usual broker's commission, taxes and other fees.
The net proceeds from the sale of the shares of stocks will then be applied to the member's outstanding SILP or PFLP loan balance.
"Any excess amount after application to the outstanding SILP/PFLP loan balance will be applied to his delinquent salary or housing loan, if any... If none, or if there is still excess amount, then this will be refunded to the member-borrower," Ciriaco said.
However, if the net proceeds from the sale of the member-borrower's shares of stock are not sufficient to cover the outstanding SILP or PFLP loan balance, then the member shall be required to pay the remaining amount either in cash, from a salary loan renewal, or from the final benefits (total disability, retirement, and death). However, the remaining balance will continue to be charged with interest and penalties until fully paid.
"While this is not the condonation program that members are waiting for, the option to sell program is the next best way for members to finally pay off their outstanding loans under the SILP and PFLP to ensure that they fully enjoy their SSS benefits without deductions," Ciriaco said.