How the SSS Salary Loan Really

Works, Plus Answers to FAQs About

Your Contributions
SSS Assistant Vice President for Media Affairs Ma. Luisa Sebastian answers some of your
concerns.

by Charlene J. Owen|SEP 1, 2017

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IMAGE SSS.gov.ph; Pexels

You’ve probably been contributing to SSS for years now partly because it’s the law, and partly
because your employer deducts your share automatically. Or maybe you’ve left your regular job
and gone freelance, which has made you stop contributing because you feel like there’s really
no point in doing so. While the concept of putting money into the Social Security System is
something that's still a bit vague, you may want to think of it this way: You’re filling in a pot of
money along with thousands of other people so that you can have something to fall back on
during a rainy day. Will it be a lot? It really depends, but it’s something, and having something is
reassuring.

To help clear the confusion that usually comes with dealing with contributions, we reached out
to SSS Assistant Vice President for Media Affairs Ma. Luisa Sebastianand asked some of the
most common questions you may have about your benefits and your loans, as well as some
that have appeared on GirlTalk. These range from the most basic issues concerning salary
loans, to the forward-looking inquiries about retirement and pension.

FemaleNetwork.com: What are the compelling reasons to apply for an SSS salary loan?
AVP Luisa Sebastian: There is usually a surge of applicants for the SSS salary loan during
enrollment and Christmas holidays. The SSS does specify the use for salary loans. The loan
can be used for educational or health needs, purchase of gadgets or any other material.

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FN: Is there a set amount for your first salary loan, and how many times can you apply
for it?
AVP Luisa Sebastian: The amount of loan proceeds depends on his/her contributions. The
loanable amount is the average of the last 12-monthly salary credits (MSC) of a member. So, if
a member is consistently paying at the minimum monthly contribution amount of P110 which
has an equivalent MSC of 1,000, then his/her loan will amount to P1,000; while a member who
is consistently paying at the maximum monthly contribution of P1,760 which has an equivalent
MSC of p16,000, then his/her loan will amount to P16,000.

Under the salary loan program, a member is entitled to avail of the salary loan if he/she has paid
at least 36 monthly contributions and has at least 6 posted monthly contributions within the last
12 months before the month of filing of application. A member who has paid at least 36 months
but not more than 72 monthly contributions is entitled to a one-month salary loan; those who
have paid at least 72 monthly contributions are entitled to a two-month salary loan.

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Using our example above, if a member paying at the minimum is entitled to a two-month salary
loan, his/her loan will then be P2,000; if member is paying at the maximum, his/her two-month
loan will amount to P32,000.

The maximum loanable amount is P32,000.

A member can apply for a loan for as many times as he/she wants, as long as he/she is
qualified. A member is allowed to renew their loan if they have paid their loan for at least one
year and their loan balance is not more than 50 percent of the principal of their last loan.

FN: If you're employed, is it better to get your salary loan through your employer or
would it be faster to process it at an SSS branch?

AVP Luisa Sebastian: If you are employed, it is best to get your salary loan through your
employer. Employed-members are required to get their certification for loan from their
employers. Also, if the employer is aware that you are filing for a loan, they can assist you in
following it up from the SSS through your company representatives. Making your employer
aware that you have been granted a loan by the SSS will also ensure that the employer will
know when deductions should be made for your loan payments, as well as the amount that
should be deducted from the member's salary.
Members can now file their salary loans online. For employed members, their employers should
be registered with the SSS online so that they can file their employees' loan applications
through the internet.

Members can also opt to get their loans through prepaid cash cards issued by SSS partner
banks.

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FN: Can one have a GSIS and an SSS membership at the same time?

AVP Luisa Sebastian: Yes. Individuals who used to work in the private sector are considered
members of the SSS even if they are not with the private sector anymore and have stopped
paying SSS contributions. The SSS has a once a member, always a member policy. This
means that these individuals can still avail of benefits from the SSS as long as they meet the
qualifying conditions. Some of these members may have transferred to government service and
become members of the GSIS. Then, they become members of both systems.

SSS advise[s] these members to continue paying their contributions with the SSS to ensure
their qualification to benefits and privileges under the system.

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FN: What happens if an employee resigns with an outstanding salary loan?

AVP Luisa Sebastian: If a member resigns with an outstanding salary loan, the employer should
deduct the full balance from the proceeds of his/her benefits from the company and this should
be remitted to the SSS. If the benefits of the employee cannot cover the full amount of the loan,
the employer should report to the SSS the effective date of separation of the employee and the
full amount of unpaid loan balance.

On the other hand, the separated employee should pay his/her loan balance on his/her own, or,
upon employment, advise the new employer of the loan so that payments to the loan can be
facilitated by the new employer.

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FN: If an employer does not remit a member's contributions, what can be done about
it?

AVP Luisa Sebastian: Members are enjoined to file a formal complaint against their employer if
they have proven that their employer is not remitting their contributions to the SSS. The member
will have to go to the nearest SSS office to do this. SSS has a rule on anonymity, which means
that the SSS will not tell the employer of the complaint but instead visit the employer and do a
routine check of their documents. If SSS sees that the employer is remiss from his duties, SSS
will bill the employer. If the employer does not comply, SSS will issue a demand letter. If at this
point, the employer will still not comply, the SSS will file a case against the employer.

An employer who fails to remit the contributions of his/her employees may be fined and
imprisoned.

FN: How can you get a salary loan if you're a freelancer, and what would be the
requirements to avail it?

AVP Luisa Sebastian: To avail of the salary loan, a member should have paid at least 36
monthly contributions and has at least 6 posted monthly contributions within the last 12 months
before the month of filing of application. A member who has paid at least 36 months but not
more than 72 monthly contributions is entitled to a one-month salary loan; those who have paid
at least 72 monthly contributions are entitled to a two-month salary loan.
When filing for a salary loan, you only need to submit a filled out salary loan application form
and a photocopy of your SSSID/UMID or in the absence, two valid IDs to the nearest SSS
office. The salary loan application form is available in SSS offices or can be downloaded and
printed from www.SSS.gov.ph.