SSS to roll out low-interest pension loans in September

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Metro Manila (CNN Philippines, July 11) — The Social Security System (SSS) will roll out pension loans for by September in light of the difficult times given the rise in the prices of basic goods and services.

SSS President and Chief Executive Officer Emmanuel Dooc said there has been great clamor to implement the second tranche of pension increases this year which is impossible because the state-owned pension fund has yet to improve its collection.

Dooc said they thought of a pension loan for pensioners with a maximum of 32 thousand pesos at only 10 percent interest per annum, payable in 1 year and insurance guaranteed.

"May parang credit life insurance… so kung namatay yung pensiyonado yung hindi ibabawas sa makukuhang benefit ng relatives niya o heirs niya yung balance of the loan," Dooc said.

[Translation: There will be like a credit life insurance, so if the pensioner dies the remaining balance of the loan will not be charged to the benefits of his relatives or heirs.]

He added that the insurance will cover the principal amount of the loan.

"At saka ang cover rates is the principal amount of the loan kahit na nakabayad na at lumiliit na yung utang ang babayaran ng insurance yung buo," the SSS Chief said.

[Translation: The cover rate is the principal amount of the loan so even if it's been partially paid, the insurance will still be in full.]

Dooc said this will somehow protect the country's pensioners who would opt to borrow from banks and other institutions with higher interest rates.