The Philippine Star
September 10, 2021 | 00:00
MANILA, Philippines — The Pag-IBIG Fund has made its cash loans more affordable by extending its payment term to three years, its top officials announced yesterday.
“During these difficult times, we continue to improve our programs to meet the needs of our members. Last year, we launched special programs such as a payment moratorium and grace periods in accordance with Bayanihan laws, to help our borrowers with their finances. This year, we are extending the term of our cash loans from two years to three years to give borrowers more time to repay their loans and, more importantly, to lower their monthly payments. This is our response to President Duterte’s call to provide the services needed to help more Filipinos recover from the pandemic,” said Secretary Eduardo del Rosario, Chairman of the Department of Human Settlements and Urban Development (DHSUD ) and all 11 members. Board of Directors of the Pag-IBIG Fund.
Cash loans from the Pag-IBIG Fund come in the form of a Multi-Purpose Loan (MPL) and a Disaster Loan (CL) for areas in a state of disaster. Also known as Short Term Loans (STLs), MPL and CL are affordable and easily accessible sources of finance for their members. Qualifying members can borrow up to 80% of their total regular Pag-IBIG savings, which consists of their monthly savings, matching employer contributions and dividends received annually.
The proceeds can then be used to pay for school fees, medical expenses, minor home improvement, as capital for small businesses or as an emergency fund during calamities.
“Pag-IBIG cash loans are repaid over 24 months. And now our members have the option to extend the term to 36 months. By choosing the longer payment period, members can enjoy significantly lower monthly payments,” Pag-IBIG Fund Managing Director Acmad Rizaldy Moti said.
Moti said that according to their calculations, they have reduced monthly payments by almost a third. With an average cash loan of 20,000 pesos, members pay 1,016.52 pesos per month for an MPL and 897.23 pesos per month for a disaster loan with a payment term of two years.
However, with the new three-year payment term option, the amount of each monthly payment will be reduced to just P734.57 per month for an MPL and P615.72 per month for a disaster loan. With payments spread over a longer period, monthly payments were reduced by 28% for the MPL and 31% for the Calamity Loan.
“We recognize that times are difficult and we are doing everything we can to help our members as the health emergency continues. From January to July alone, we released 25.42 billion pesos in cash loans to help over 1.1 million members. We are ready to help more members in the coming months, now that the extended payment term has made our cash loans even more affordable. We have also made the loan application process safer and more convenient by accepting loan applications online through the Virtual Pag-IBIG. It’s Lingkod Pag-IBIG at work, especially when the members need us the most,” Moti said.