MANILA - Government-owned and controlled corporation Pag-IBIG Fund has made cash loan payment easier for Filipinos with the extended payment term of up to three years.
In a statement released Thursday, September 9, Department of Human Settlements and Urban Development (DHSUD) Secretary Eduardo del Rosario and Pag-IBIG Fund Board of Trustees said its agency continues to improve its programs to respond to the needs of its members in the middle of the COVID-19 pandemic.
"We are lengthening the term of our cash loans from two years to three years to give borrowers more time to pay off their loans, and more importantly, to make its monthly payments lower," they said.
Pag-IBIG Fund’s cash loans come in the form of a Multi-Purpose Loan (MPL), and a Calamity Loan (CL) for areas under a state of calamity. Also known as Short-Term Loans (STL), the MPL and CL serve as affordable and readily accessible sources of funds for its members.
Qualified members can borrow up to 80 percent of their total Pag-IBIG Regular Savings, which consists of their monthly savings, their employer’s counterpart contributions, and dividends earned annually.
The proceeds can then be used to pay for tuition fees, medical expenses, minor home improvement, as capital for small businesses, or as emergency fund during calamities.
Pag-IBIG Fund CEO Acmad Rizaldy Moti said by their calculation, they have reduced monthly payments by almost a third with the extension of payment period.
With the average cash loan amounting to P20,000, members pay P1,016.52 per month for an MPL, and P897.23 per month for a calamity loan under a two-year payment term.
However, with the new three-year payment term option, the amount of each monthly payment will be reduced to only P734.57 a month for an MPL, and P615.72 a month for a calamity loan. With payments spread out over a longer period, monthly payments were brought down by 28% for the MPL and 31% for the Calamity Loan.
"We are poised to help more members in the coming months, now that the extended payment term has made our cash loans even more affordable. We also made the process of applying for loans safer and more convenient by accepting loan applications online," Moti said.