SIXTEENTH CONGRESS OF THE ) 
REPUBLIC OF THE PHILIPPINES ) 
First Regular Session 
) 
SENIT~ 
S.B. No. 
£I58 
Introduced by: Senator Paolo Benigno "Bam" A. Aquino IV 
EXPLANATORY NOTE 
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SEP -2 P 2 :~2 
One of the enduring legacies of the late Senator Benigno "Ninoy" S. Aquino, Jr. is the "Studv 
Now, Pay Later" Program. It was designed to give every Filipino access to tertiary education, with the 
belief that this will enable more Filipinos to get better jobs with better incomes, and help them get 
ahead in life. 
Thirty years after Ninoy Aquino's death, as we push for inclusive growth for every Filipino, we 
also seek to strengthen the Study Now, Pay Later Program to ensure that every Filipino who wishes to 
take up tertiary-level studies will be able to do so. 
The strengthened Study Now, Pay Later Program (SNPLP) proposes that an Education loan 
Fund be established to make zero-interest loans available to eligible student beneficiaries to cover 
tuition and other school fees and education-related expenses towards the completion of college degree 
courses or vocational and technical courses. 
Under our proposed program, the Education Loan Fund shall be administered by an Education 
Loan Fund Board headed by the chairperson of the Commission on Higher Education (CHED) and the 
Technical Education and Skills Development Authority (TESDA). Among its functions, the Board shall be 
responsible for establishing systems for the following: 
(1) The effective disbursement and collection of loan payments, including but not limited 
to: arranging for the Government Service Insurance System (GSIS) and the Social Security 
System (SSS) to act as the authorized and official collection agencies for loan repayments; 
and 
(Z) Proper tracking and monitoring loan recipients, including but not limited into entering 
an agreement with various concerned government agencies including the Bureau of 
Internal Revenue (BIR), GSIS, SSS, National Bureau of Investigation (NBI), Department of 
Foreign Affairs (DFA), Philippine Overseas Employment Administration (POEA), Bureau of 
Immigration (BI), Bangko Sentral ng Pilipinas (BSP), and the Credit Information Corporation, 
as well as private and public banks and intermediaries, credit information bureaus, and 
other financial institutions, inclusive of investigating and checking the whereabouts of loan 
recipients, and setting up mechanisms for blacklisting of defaulting borrowers in 
applications for loans, credit cards, and other credit facilities. 
These mechanisms seek to make it easier and more convenient for beneficiaries to pay for their 
loans while making it more efficient for government to collect loan payments. These are meant to 
ensure that the Study Now, Pay Later Plan can become a long-term program of the government with 
benefits that are extended to even more beneficiaries. 
At present, the government's Study Now Pay Later program for the school year (Z013-Z014), 
covers 538 beneficiaries nationwide with an average loan of Php60,OOO per qualified student per year. 


Since the program was re-Iaunched in 1999, at least 16,907 students have already received 
student loans amounting to a total of Php217 million. However, the CHED reports that, as of December 
2012, only Php26.8 million or 12.36 percent of these loans have been repaid. 
Thus, it becomes imperative that we strengthen and improve the system, especially on the loan 
repayment side, to ensure that funds are ploughed back to the government to give more students the 
opportunity for tertiary-level education. 
In view of the foregoing, the early approval of this bill is earnestly sought. 
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..§?I'I11h' 
l~fflrr' of Hit' .~t-rri'b:l'~ 
SIXTEENTH CONGRESS OF THE ) 
REPUBLIC OF THE PHILIPPINES ) 
First Regular Session 
) 
'13 
SEP -2 P 2 :42 
SENI\,TE 
S.B. No. 1.1158 
Introduced by: Senator Paolo Benigno "Bam" A. Aquino IV 
STRENGTHENING THE STUDY NOW, PAY LATER PLAN 
FOR POST-SECONDARY EDUCATION 
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SECTION 1. Short Title. - This Act shall be known as the "Study Now Pay Later Plan of 2013" 
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SECTION 2. Declaration of Policy. -
It is the policy of the State to protect and promote the right of all 
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citizens to quality education at all levels and to take appropriate step to make such education accessible 
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to all. Recognizing the importance of higher education in enhancing economic opportunities for its 
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citizens, it is also a policy of the State to support and promote access to higher education through 
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student loan programs and other funding and support mechanisms to the end that no person shall be 
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deprived of the benefits of education on account of poverty. 
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In pursuance thereof, the "Study Now Pay later Plan" of the State is hereby strengthened and reinforced 
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to provide a more effective educational financial assistance program for deserving students. 
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SECTION 3. Definition of Terms. -
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a. 
Study Now, Pay later Plan refers to the educational financial assistance program of 
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government designed to promote access to post-secondary level education through the 
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provision of education loans. 
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b. 
Education Locin Fund refers to funds acquired under the provision of this Act administered 
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and held in trust by the Commission on Higher Education (CHED) and Technical Education 
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and Skills Development Authority (TESDA) for the operationalization of the Study Now Pay 
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later Plan (SNPlP). 
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c. 
Post-Secondary Education refers to education in degree courses offered by higher 
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educational institutions or to education and training in non-degree vocational and technical 
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courses offered in post-secondary vocational and technical education institutions, the 
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completion of which are attested. by a diploma or certificate issued by or with permission of 
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CHED or TESDA respectively. 
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d. Education Loan Eligibility Certificate is a non-negotiable, non-transferable instrument issued 
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by the Education Loan Fund Board that proves the qualification of the person named therein 
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as grantee to obtain loans and other obligations from CHED or TESDA subject to the terms 
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and conditions that the Education Loan Fund Board may provide. 
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e. 
Education Loans refer to such amounts loaned to student recipients to cover matriculation 
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and other school fees, and to cover education-related expenses for books, subsistence, 
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board and lodging. 
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SECTION 4. Education Loan Fund Board. - To carry out the purposes of this Act, there is hereby created 
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an Education loan Fund Board, hereinafter referred to as the Board, a governing body that shall 
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formulate policies, guidelines, and rules and regulations necessary for the operation, management and 
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supervision of the Education Loan Fund and SNPlP. 
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SECTION 5. Composition of the Board. - The Board shall be composed of the following: 


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a. 
Chairman of the CHED, as Chairperson, 
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b. 
Executive Director of TESDA, as Vice-Chairperson, 
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c. 
One representative each from the following government offices, as members: the 
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Department of Labor and Employment, Bureau of Internal Revenue (BIR); Government 
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Service Insurance System (GSIS); Social Security System 
(SSS); Credit Information 
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Corporation (CIC), Senate Committee on Education, Arts and Culture; and Committee on 
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Higher and Technical Education of:the House of Representatives; and 
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d. 
One representative each from the following, as members: the Coordinating Council of 
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Private Educational Associations (COCOPEA); the Philippine Association of State Universities 
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and Colleges (PASUC); the Association of Local Colleges and Universities (ALCU); and the 
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Technical-Vocational Schools Association of the Philippines (TEVSAPHIL). 
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SECTION 6. Powers and Functions. - The Board shall have the following functions: 
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a. 
Formulate policies, standards and guidelines necessary for the implementation of the Study 
Now, Pay Later Plan (SNPLP); 
b. 
Create an administrative unit within CHED and TESDA tasked to manage the Education Loan 
Fund and program for lending to students in various post-secondary educational 
institutions; and to be the repository for all pertinent information related to the SNPLP and 
its loan recipients; 
c. 
Establish and adopt a program for generating funds for the Education Loan Fund for 
students who qualify under th!, provision of this Act; 
d. 
Establish an efficient system for the disbursement and collection of payment of loans 
granted under this Act, including but not limited to entering into agreements with GSIS and 
555 to automatically withhold from members who availed of SNPLP loans a portion of their 
member contributions, and to deposit the amount to the Education Loan Fund as loan 
payments; 
e. 
Establish an efficient system for tracking loan recipients, including but not limited to 
entering into agreements with the BIR, GSIS, SSS, National Bureau of Investigation (NBI), 
Department of Foreign Affairs (DFA), Philippine Overseas Employment Administration 
(POEA), Bureau of Immigration (BI), Bangko Sentral ng Pilipinas (BSP), the CIC, private and 
public banks and intermediaries, credit information bureaus, and other financial institutions, 
inclusive of investigating and checking the whereabouts of loan recipients, and setting up 
mechanisms for blacklisting of defaulting borrowers in applications for loans, credit cards, 
and other credit facilities; 
f. 
Enter into an agreement with BIR to acquire the Tax Identification Number (TIN) of each 
loan recipient or to provide each loan recipient with a TIN to facilitate ease in tracking the 
loan recipients and their payments; 
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g. 
Avail of the personnel and office facilities of the CHED, TESDA, Department of Education, 
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universities, colleges and schools in coordination with the proper offices for the 
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implementation of the provisions of this Act; 
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h. 
Exercise such other powers and functions reasonably necessary for the proper-
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implementation of this Act. 
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SECTION 7. Administration of SNPLP. -
The administration and management of the SNPLP and the 
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Education Loan Fund shall be the primary responsibility of the CHED and TESDA, which includes the 
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following specific functions: 


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a. 
Plan, implement, and monitor annual work programs and submit annual reports in 
pursuance of the objectives of this Act; 
b. 
Receive, review and approve loan applications based on qualifications provided by Section 9 
of this Act; 
c. 
Issue Education Loan Eligibility Certificates which shall be valid anywhere in the country as 
proof of the eligibility of the student to avail of the loan assistance; 
d. 
Cancel the Certificates based on the grounds under Section 13 of this Act; 
e. 
Maintain and manage the Education Loan Fund and facilitate proper disbursement and 
collection of funds; 
f. 
Maintain and regularly update list of loan borrowers and list of priority courses to be 
offered; 
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g. 
Coordinate with BIR, GSIS, SSS, and other government agencies and institutions as needed 
13 
for loan disbursement and collection of payments; 
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h. 
Perform such other functions as may be reasonably necessary for the implementation of 
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this Act. 
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SECTION 8. Education Loan Fund. -
The Board shall establish an Education Loan Fund for CHED and 
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TESDA, which shall be used to finance educational loans to cover matriculation and other school fees 
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and related educational expenses. 
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a. 
Seventy percent (70%) of the funds allocated for CHED and TESDA annually through their 
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various financial assistance programs shall go to the Education Loan Fund of the SNPLp·. 
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Likewise, the amount derived from the loan payment of borrowers, which include payments 
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for the principal and interests, shall accrue to the Education Loan Fund; and 
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b. The Board shall solicit and receive donations and other forms of contribution from both 
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public and private sources, which shall accrue to the Education Loan Fund. Provided, that 
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such donations and other contributions shall be exempt from taxation and shall be 
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allowable deductions for income tax purposes. 
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SECTION 9. Qualification of Loan Recipients. -
Students availing of education loans as provided by this 
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Act must possess the following qualifications at the time of application: 
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a. 
He or she is a Filipino citizen; 
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b. 
He or she intends to enroll or is currently enrolled in any of the priority courses, to be 
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determined by the CHED and TESDA, and have passed the entrance requirements of the 
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post-secondary education institution attended or to be attended; 
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c. 
He or she must have a National Secondary Achievement Test (NSAT) rating of 75% or higher, 
if highest education level attained is secondary education; 
d. 
He or she must have a general weighted average of 75% or higher, if previously enrolled in a 
post-secondary education course; 
e. 
He or she must not have been convicted of any crime involving moral turpitude; 
f. 
He or she must have attended the orientation seminar arranged by CHED or TESDA, which 
includes a session on credit responsibility to be conducted or approved by the Credit 
Information Corporation (Cle); and 


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g. 
Such other qualifications as may be provided by the Board. 
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SECTION 10. Coverage. -
Granting of education loans shall be based on the eligibility qualifications 
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determined in Section 9 of this Act and subject to the availability of the funds as determined by CHED 
4 
and TESDA. In the event that CHED and TESDA cannot accommodate all loan applicants, the applicants 
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can re-apply for the loan in the following acader:nic term. Granting of education loans shall be on a first 
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come, first serve basis to avoid any abuses in the process. 
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SECTION 11. Amount of Loans. -
The Board shall determine the maximum amount a student can avail 
8 
under this Act. The education loan can only be used to cover tuition and other school fees to fulfill 
9 
matriculation in a post-secondary education'institution, and the cost of books, subsistence, board and 
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lodging: Provided, loans granted for payment of tuition and other fees shall be directly payable to the 
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post-secondary education institution concerned. 
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SECTION 12. Interest Rate and Payment Terms. - The Board shall determine the terms of payment and 
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other policies to carry out this Act, provided that these principals must be observed: 
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a. 
Interest at the rate of zero percent (0%) per annum shall be applied to the loan or the 
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balance thereof; 
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b. 
Loan recipients shall begin paying their loans after two (2) years following the completion of 
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the course for which the proceeds of the l.oan were expended: Provided, the government 
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shall endeavor to give ample assistance to students under the program in obtaining possible 
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employment and that loans may be paid through staggered payment schemes; 
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c. 
Loan recipients who prefer to avail of the staggered payment scheme may be required to 
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become a member of GSIS or. 555. GSIS or SSS shall then automatically deduct the loan 
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payments from the member contributions of the loan recipient. The Board shall determine 
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the amount to be withheld by GSIS and SSS as loan payment. Provided, however, that the 
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loan recipient may opt at any time to pay the loan or its balance in full; 
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d. 
Prior to the end of the two (2) year period, voluntary payment of loans may start any time 
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the loan recipient wants to pay; 
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e. 
The list of loans due for payment shall be submitted by CHED and TESDA to the BIR and 
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other concerned agencies for tracking purposes and to GSIS and SSS for automatic 
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deductions; 
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f. 
CHED and TESDA shall seek the aid of other government agencies and institutions to 
monitor the whereabouts of the loan recipients. 
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SECTION 13. Disqualifications. - The education loan assistance extended to a student shall be accorded 
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to the student loan borr.ower for the entire duration or remaining of his/her degree/vocational course 
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unless any of the following occurs: 
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a. 
The student fails majority of his. or her academic subjects every semester or two (2) 
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consecutive semesters, unless such is due to a valid cause beyond the student's control; 
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b. The student fails to finish his or her course within four (4) semesters from the semester he 
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or she is expected to finish as fixed by the course curriculum, unless such is due to a valid 
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cause beyond the student:s control; 
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c. 
The student stopped schooling for two (2) semesters, unless such is due to a valid cause 
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beyond the student's control; 
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d. The student is convicted of any crime involving moral turpitude. 


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For (a) to (c), the valid cause referred to therein must be properly substantiated in accordance with the 
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implementing rules and regulations. 
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SECTION 14. Implementing Rules and Regulations. -
CHED and TESDA shall, within sixty (60) days from 
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the effectivity of this Act, issue such rules and regulations necessary for the proper implementation 
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thereof. 
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SECTION 15. Appropriations. -
The amount necessary to carry out the provisions of this Act shall be 
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charged to the appropriations of CHED and TESDA. Thereafter, such sum as may be necessary for its 
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continued implementation shall be included in the annual General Appropriations Act. 
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SECTION 16. Repealing Clause. -
All laws, decrees, executive orders or parts thereof inconsistent with 
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the provisions of this Act are hereby repealed, amended or modified accordingly. 
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SECTION 17. Separability Clause. -
If any provision of this Act is held invalid or unconstitutional, other 
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provisions not affected shall continue to be in full force and effect. 
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SECTION 18. Effectivity. -
This Act shall take effect fifteen (15) days after its complete publication in at 
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least two (2) newspapers of general circulation. 
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Approved, 
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