In response to the call of President Rodrigo Duterte for credit support to education in light of the economic effects of the coronavirus pandemic, state pension fund Government Service Insurance System (GSIS) opened on Monday a P20-billion study-now, pay-later loan program for the college education of its members’ kin.
“We will allow GSIS members who have at least 15 years of government service to avail of an educational loan for their kin in college. The loan has a term of ten years but we will not require them to pay anything in the first five years. So they don’t have to worry about the tuition of their children for the first five years,” GSIS President and General Manager Rolando Ledesma Macasaet said in a radio interview.
Under the GSIS Financial Assistance Loan-Educational Loan (GFAL-EL), the maximum amount that may be borrowed per academic year is P100,000 covering tuition and other school fees.
The interest rate is only 8 percent.
A GSIS member may nominate up to two student-beneficiaries under the program.
The two must be related to him or her up to the third degree of consanguinity or affinity and enrolled in a four-or five-year course in a private or public educational institution.
The loan proceeds will be directly paid to the school under the student’s account every semester or trimester until the beneficiaries finish their courses.
Members, including special members who have at least 15 years of service, may apply for the loan.
They must not be on leave of absence without pay, have no pending administrative or criminal case, and have no past due GSIS loans, including housing loans.
They must also meet the required net take-home pay of P5,000 after deduction of their monthly premium contributions and loan amortizations, and their agencies must not be on suspended status.
“The loan has an insurance cover to protect the interest of the borrowers and their student-beneficiaries. Thus, it will be deemed fully paid in case the member or the student dies or becomes permanently and totally disabled,” Macasaet added.