Pag-IBIG releases record P51 billion in short-term loans

MANILA, Philippines — The Home Development Mutual Fund, commonly known as Pag-IBIG Fund, released nearly P51 billion in short-term loans from January to October to help members access additional funding.

In a statement, Pag-IBIG said it disbursed P50.79 billion in cash loans from January to October, up 12 percent from the P45.29 billion in the same period last year.

The number of those who benefited from the cash loans also increased by six percent to 2.28 million as more members utilized Pag-IBIG’s online channel to apply.

About a third of Pag-IBIG members who availed themselves of cash loans during the period applied online, registering an increase of nearly 60 percent from a year ago. It is equivalent to some P16.65 billion.

Pag-IBIG Fund CEO Marilene Acosta said the growth in cash loans was driven by the reliability and ease of access for availment.

Pag-IBIG’s short-term loan program includes the agency’s multi-purpose loan (MPL) and calamity loan.

The bulk or 95 percent of the total loans were MPL valued at P48.32 billion, benefiting 2.13 million members.

Under the MPL, qualified members can borrow up to 80 percent of their total Pag-IBIG regular savings, which consist of their monthly contributions, their employer’s contributions and accumulated dividends earned.

The proceeds may be used to pay for tuition, medical expenses, minor home improvement or a family trip, or can serve as capital for small businesses.

Borrowers may choose between a 24 and 36-month payment term and are provided a two-month grace period prior to their first payment.

The MPL comes at an interest rate of 10.5 percent per annum.

Calamity loans, which are available to members residing or working in areas declared under a state of calamity, amounted to P2.48 billion during the 10-month period. Calamity loans helped nearly 150,000 members during the period.

In the past years, Pag-IBIG has returned more than 90 percent of its income, mostly derived from interest on loans, to members in the form of dividends.

Currently, Pag-IBIG has 15.58 million active members.