GSIS launches new lending program with longer repayment terms, lower interest

State workers’ pension fund Government Service Insurance System (GSIS) has launched a new lending program with lower interest rates and longer repayment terms.

In a statement on Tuesday, GSIS said it has launched the Multi-Purpose Loan Flex program (MPL Flex) “designed for teachers and other GSIS members.”

The new loan program offers a reduced interest rate from 7% to 6% for members with a minimum of three years of premium contributions and an extended repayment period of up to 15 years.

GSIS said the MPL Flex program also enables members with just one month of paid premium to apply for the loan and provides a lower service fee than the rate offered by private lenders.

Teachers and members may apply for the MPL Flex through the GSIS Touch mobile app ensuring a streamlined and paperless loan application process, it said.

Moreover, the pension said it introduced a detailed payment schedule for Multi-Purpose and emergency loans which began in June.

GSIS said the initiative provides teachers with a much clearer presentation on how their payments are allocated between principal and interest.

By offering a comprehensive breakdown of the payment schedule, borrowers will have a clearer view of their loan obligations, it said.

And to further improve the terms, the pension fund also revised its penalty interest computation for defaulted loans, it added.

"If these outstanding amounts are offset against retirement or separation benefits, teachers could potentially receive diminished proceeds,” said GSIS president and general manager Wick Veloso.

Veloso emphasized the need for timely and accurate loan repayments as he stressed that unpaid loans accrue interest and penalties.

“We assure the DepEd (Department of Education) and all our teachers that the GSIS is continuously working to make our lending process and loan calculations clearer,” said the GSIS chief.—AOL, GMA Integrated News