In celebrating its 82nd anniversary, the Government Service Insurance System (GSIS) shines its light on its centerpiece program which aims to raise the quality of life of its members–the GSIS Financial Assistance Loan (GFAL).
GFAL has been making its mark as the pension fund’s strategy to help address the members’ perennial problem of overborrowing that results to reduced GSIS benefits stemming from unpaid loans. Initially, GFAL reached out to the teaching and nonteaching personnel of the Department of Education, the sector that constitutes more than half of GSIS’s membership. It has now been extended to the rest of GSIS members.
A teacher who benefited from GFAL tells her story below and recounts how the program has greatly improved her life.
Doting mother to three children and wife of a modest jeepney driver from Mataas na Kahoy, Batangas, high school teacher Mrs. Ana Lee Mendoza understands the importance of family and financial freedom. Like millions of ordinary Filipinos with mouths to feed and young minds to nurture, the Mendoza family makes extraordinary struggles to make ends meet.
While Mrs. Mendoza loves her profession as much as she loves her family, she admits that her income as an educator in Bayorbor National High School is barely enough to cover her family’s expenses. Since they also live with and take care of her in-laws, the couple knew that they had to double their efforts to ensure that their day-to-day expenses are met.
“Tulungan kami’ng mag-asawa. Ginawa naming pampasaherong dyip ang aming sasakyan noong 2015. Nakakatulong ang kinikita niya sa pamamasada para tustusan ang aming mga pangangailangan,” she shared in an interview. Sadly, their combined income was not enough to prepare them for the emergency that came.
It was when their eldest daughter was diagnosed with a life-long and rare condition called aplastic anemia in 2017 that Mrs. Mendoza decided to take out loans from private lending institutions (PLIs) to pay for continual therapy and medication.
The undeducted obligations as well as expenses for their daughter’s repeated blood transfusions, vitamins, and other medicines, would go on to plague the family, but Mrs. Mendoza’s determination to erase her cycle of debt remained.
When she learned about the GSIS Financial Assistance Loan (GFAL) online, she knew in a heartbeat that their lives were going to change. As soon as the loan was granted in November last year, things started to look up for her and her family.
“Ginamit ko ang pagkakataong ito upang mabura na ang undeducted obligations sa aking pay slip…Mabilis pinroseso ang aking application. Naramdaman ko na agad na lumaki ang income ko,” she said.
According to her, the free financial literacy program reminded her on the importance of spending within her means and saving funds for emergencies.
Asked what’s next for the Mendoza family, she enthused that they intend to upgrade their alternative source of income and complete their property investment.
She furthered, “Masarap sa pakiramdam yung wala kang inaalala. Ngayon, naisasali na namin ang aming pangalawang anak sa inter-school karate competitions. Nakakapag-travel na rin kami bilang pamilya na hindi namin dati nagagawa…Sa GFAL, gagaan ang buhay.”
What you need to know about GFAL
1.What is GFAL?
The GSIS Financial Assistance Loan is a program being implemented by GSIS to help its members improve their financial standing. GFAL is a debt-consolidation and balance-transfer facility that enables GSIS members to settle their outstanding loan balance with lending institutions, such as those privately run, as well as government banks and government cooperatives at reduced interest rate and longer payment term.
2.How will I know if I am qualified to apply for GFAL?
You are qualified to apply for GFAL if you are a permanent government employee and active GSIS member who:
a. has outstanding loan with the lending institutions;
b. has no due and demandable loan account with GSIS;
c. has paid premiums of at least three years;
d. is not on leave without pay;
e. has net take-home pay of not lower than Php5,000.00 after deduction of monthly obligations; and
f. has no pending administrative or criminal case.
3.How much is the maximum GFAL loan amount that I can apply for?
You may apply for a maximum loan amount of Php500,000.00.
4. A PLI has filed a case against me for nonpayment of obligations. Am I still qualified for GFAL?
If a PLI has filed a case against you for nonpayment of obligations after GSIS loan payments have been prioritized (by virtue of DO Nos. 38 and 55 for DepEd personnel or related agency-issuances for other government employees in compliance to the provisions of the General Appropriations Act), you are still qualified to apply for GFAL.
5. What is the interest rate and payment term for GFAL?
The interest rate is 6 percent per annum computed in advance. The loan is automatically deductible from your salary and payable in 72 equal monthly instalments or 6 years.
6. Does GSIS collect service fees for GFAL?
No, GSIS does not charge service fees for this particular program.
7. I have other loan arrears. Will these be deducted from the proceeds of GFAL?
The arrears incurred from your other loans will not be deducted from the proceeds of GFAL.
8. If I have an in-default loan (that has not been paid for more than six months), how can I apply for GFAL?
You may opt to have your in-default loan restructured through the Consolidated Loan (Consoloan) Plus program. You may qualify for GFAL once the in-default loan is no longer reflected in your records.
9. What is the basis in computing my loan amount in GFAL? What if I have outstanding loans with multiple private lenders?
Your loan amount is computed based on the final statement of account (SOA) that is submitted along with other GFAL application documents. You cannot apply for an amount that exceeds the total obligation indicated in the SOA. If you have two or more loans from private lenders, your loans based on the submitted SOAs will be consolidated.
10. What are the documentary requirements that I need to submit?
You must submit the following:
a. Duly accomplished GFAL application form signed by the Agency Authorized Officer (AAO);
b. SOA following the format issued by GSIS, with a clear photocopy of ID of the authorized representative of the lending institution who will claim the check from GSIS. The contact number of the representative must also be stated in the SOA.
c. Borrower loan agreement, loan voucher, or other certified documents that show the term, interest rate, monthly amortization, and due date of the first loan amortization.
d. Borrower’s pay slips for the past three months from the start of application. The pay slip must be certified by the AAO.
Only applications with complete documents will be processed.
11. How can I apply for GFAL?
You should follow the six-step guide:
• Step 1: Accomplish the application form and SOA completely and correctly.
• Step 2: Complete all documentary requirements.
• Step 3: File the application at the nearest GSIS office. Once done, the applicant will be given an endorsement slip to attend the Financial Literacy Seminar from the GSIS office.
• Step 4: Attend the financial literacy seminar at the GSIS office.
• Step 5: Proceed with the loan evaluation and counselling session.
• Step 6: Sign all loan documents. The form will be given after evaluation and counselling.
12. Am I required to attend the GSIS financial literacy seminar for GFAL? Will my attendance to another company’s financial literacy seminar suffice?
Yes, GSIS requires you to attend its financial literacy seminar as a prerequisite for loan evaluation and counselling on GFAL. Financial literacy seminars conducted by other companies will not be considered a valid compliance to GFAL requirements. GSIS designed its financial literacy seminar specifically for its attendees to help them better understand GFAL.
For questions on GFAL, visit the nearest GSIS Office or call the GSIS Contact Center:
• Landline (Metro Manila): 847-4747
• Globe Toll Free Number: 1-800-8-847-4747 (free from both Globe landline and mobile phone)
• PLDT/Smart Toll Free Number: 1-800-10-847-4747 (free from PLDT landline: a flat rate of P8.00/per call from mobile phone)