Pag-IBIG Fund gets nod from labor, employer groups to raise decades-old savings rate.
After several months of public consultation, Pag-IBIG Fund has secured the support of labor and employer groups to raise the three decades-old P100 monthly savings rate of its members.
Acmad Rizaldy Moti, Pag-IBIG Fund chief executive officer, said the proposal is to adjust the members’ savings rate to P200 per month by 2021, which will be matched by an equivalent amount by their employers.
Moti said the proposed adjustments will provide the agency additional funds to address its loan demand, and thus allow interest rates on its home loans and calamity loan to remain low at least until 2024.
Secretary Eduardo del Rosario, chairman of the Housing and Urban Development Coordinating Council (HUDCC) and Pag-IBIG Fund Board of Trustees, said the low interest rates of its home loans make homeownership within reach of members, resulting into the tremendous growth of home loans.
“For us to continue financing the growth in home loans of our members under such low rates, there is a need to increase our members’ P100 monthly savings,” Del Rosario said.
The Fund spent the last six months consulting stakeholders to seek their views on the plan.
These include the Trade Union Congress of the Philippines, Philippine Government Employees Association, Kapisanan ng mga Manggagawa sa GOCCs at GFIs (KAMAGGFI), Federation of Free Workers, the Filipino Migrant Workers Group, OFW NGOs, the National Anti-Poverty Commission and the Employers Confederation of the Philippines.
Moti said demand for home loans has grown annually at an average of 17.5 percent in the past five years.
“We have been able to sustain this double-digit growth in 2019 with the release of P58.73 billion in home loans in the last nine months. This is the highest-ever amount released for any January to September period and is a 13.5 percent increase from the P51.76 billion released in the same period last year. At the current membership savings rate, in addition to our housing and short-term loan collections, we have more than enough funds to support up to 10 percent average growth rate in home loans until 2024. But as we expect demand to remain strong with growth at around 15 percent annually in the coming years, we need to find additional sources of funds to sustain the low loan interest rates we currently offer to our members,” Moti said.