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GSIS offers financial assistance loan program to state workers

VIGAN CITY — Instead of running to private lenders and loan sharks for a fresh loan, the Government Service Insurance System (GSIS) is offering the expanded GSIS Financial Assistance Loan (GFAL) program or GFAL II for non-Department of Education (DepEd) agencies and local government units. 

Ms. Angelica Gatchalian of GSIS La Union said GFAL is the balance-transfer and debt-consolidation facility of GSIS that aims to help active GSIS members settle their outstanding loan obligations with lending institutions.

Originally offered to teaching and non-teaching personnel of DepEd, the program has been extended to the rest of GSIS members effective July 27, 2019.

“GFAL II seeks to ease the burden of other government personnel and help enhance the pension fund’s collection efficiency. Under GFAL II, borrowers may transfer their loan balances to GSIS from lending institutions,” Gatchalian told the employees of the Philippine Information Agency in the Ilocos in a financial literacy seminar held at the office recently.

The conduct of a financial literacy seminar is a requirement prior to loan processing.

She said, “A maximum loan amount of Php500,000, with an interest rate of only 6% per annum, and longer repayment period of six years is certainly advantageous to our members. This will ultimately result in higher net take home pay and protect their future retirement.” 

To qualify for GFAL, Gatchalian said agencies should first enter into a memorandum of agreement with GSIS to enable their employees to avail themselves of GFAL. 

“Qualified to apply for the loan program are permanent government employees with outstanding loan from lending institutions, government banks, or cooperatives accredited or recognized by their agency; have at least three years of periods with paid premiums; and have no due and demandable loan account with GSIS,” she said.

She added, “They should not be on leave without pay at the time of application; have a net take-home pay of not lower than Php5,000 after deduction of monthly obligations; and have no pending administrative case or criminal charge.”

This year, GFAL’s features were further improved by introducing a Top-Up option, which will enable borrowers to maximize the loanable amount of Php500,000.

“GFAL borrowers whose outstanding loans with lending institutions do not exceed Php500,000 may apply for the remaining available credit as Top-Up Loan. Unlike the GFAL proceeds, which GSIS pays directly to lending institutions, the Top-Up Loan proceeds will be released to the member to help GFAL borrowers augment their funds to defray for their other needs,” Gatchalian said.

She encouraged government employees with outstanding loans from lending institutions to take advantage of the GFAL II as it is a one-time offer of the GSIS and is not renewable.