/..,.,,:;
Republic of the Pliflippines
HouSH OF RnpRHSENTATlvHS
Quezon City, Metro Manila
NINETEENTH CONGRESS
First Regular Session
HouseBfl|No.6291
Introduced by Representative Midy N. Cua
Lone District, Quirino
RECENED
#A;i:[rfe=2Orfe
•           u,``  I --.-- _--'     -----           (a
•.   T'ME;-   4#
BY:-
AN ACT INSTITUTIONALIZING THE HIGHHR EDUCATION LOAN PROGRAM (HELP)
TO BE PROVIDED BY THE DEVHLOPMHNT BANK OF THE PHILIPPINES 0BP) AND
THE LAND BANK OF THE pHILlpplNEs (LBp), AND FOR OTHER puRposns
EXPLANATORY NOTE
This  bill  seeks  to  institutionalize  the  Higher  Education  Loan  Program  (HELP),  a  complementary
government  program  to  the  Unified  Student  Financial  Assistance  System  for  Tertiary  Education
quniFAST).
The Philippines has introduced various student loan programs over the years. Republic Act No. 6728
or the  Government  Assistance  to  Students  and  Teachers  in  Private  Education  Act  introduced  the
"Study Now, Pay Later Plan" (SNPLP) to be administered by the Department of Education, Culture
and Sports (DECS). Under the plan,  loan amounts were paid directly to educational institutions by
government while loan repayments were to be paid by student-debtors after a period of two (2) years
from the time the student-debtor has acquired employment.
In the 2017 Annual Audit Report prepared by the Commission on Audit (COA) for the Commission
on Higher Education (CHEd), COA observed "weak loan collection mechanisms and inadequacy of
records  relative  to  the  release  of SNPLP  loans."  The  report  cited  a  collection  rate  of 2.09%  or
P2,885,950.78 of loan receivables amounting to P 138,235,094.40.
From  1998 to 2008, a total of Pl,065,696,000.00 was allocated for HEI-Based Loan Programs such
as the President Gloria Macapagal-Arroyo Higher Education Loan Program (PGMA-HELP), Student
Assistance Fund for Education (SAFE), SAFE-for Strong Republic (SAFE 4 SR), Student Loan Fund
for  Region  V  (SLF-RV),  and  the  Student  Loan  Program-Center  of Excellence  (SLP-Center  of
Excellence).  In the same 2017 Annual Audit Report, the COA observed that the lack of monitoring
mechanisins resulted in zero/low utilization and non-submission of semestral status of loan program.
In the 2021  Armual Audit Report, the COA noted that the  Student Loan Program under UniFAST
remained unimplemented as of 31  December 2021. This is due to the absence of a loan repayment
mechanism   in   the   Memorandum   of  Agreement   between   CREd,   UniFAST   Board,   and   the
Development Bank of the Philippines.
Our  experiences  in  providing  for  student  loan  programs  over  the  last  four  decades  p{}int  to  the
incompatibility  of  National  Government  Agencies  as   the  primary  implementing  arm  of  loan
programs. The design, implementation, monitoring, and evaluation of loan programs are the expertise
of financial  institutions  whose  primary  business  is  in  lending.  The  role  of National  Government


Agencies  should  be  limited  to  their  participation  in  setting  the  policy  direction  and  in  providing
financial institutions with the necessary information for the smooth implementation of a student loan
Program.
In   this   regard,   this   bill   proposes   that   Government   Financial   Institutions   (GFls)   lead   the
implementation of the HELP. In addition, relevant government agencies, together with the involved
GFI shall constitute a HELP Council, which shall be the primary policymaking body for the program.
In view of the foregoing, the immediate passage of this bill is earnestly sought.
-, `''         ,
.   ./`J
MIDY.N. CUA
Rinresento[tive
Lone District, Quirino


Republic of the Philippines
HOUSE OF REPRESENTATIVHS
Quezon City, Metro Manila
NINETEENTH CONGRESS
First Regular Session
House Bill No.6 2 9 1
Introduced by Representative Midy N. Cua
Lone District, Quirino
AN ACT INSTITUTIONALIZING THE HIGHHR HDUCATION LOAN PROGRAM (HELP)
TO BE PROVIDED BY THE DEVELOPMHNT BANK OF THE PHILIPPINES (DBP) AND
THE LAND BANK OF THE pmLlpplNEs (LBp), AND FOR OTHER puRposEs
Be it enacted by the Senate and House Of Representatives Of the Philippines in Congress assembled..
SHCTION 1. Sfaor/ 7t.f/e. -This Act shall be known as the "mgher Education Loan Program (HELP)
Act.„
SEC.  2. Dec/¢r¢#.o#  o/Po/I.ey.  - The  State recognizes the  importance of education in accelerating
social progress  and promoting development.  Thus,  it is essential  that complementary programs  are
instituted to broaden access to education.
SEC. 3. De##z.fz.o# o/re777!s. -As used in this Act:
(a)  Di.sb"rs'eme#f scrfeedc4/e refers to the schedule for disbursement of loan proceeds determined at
the time the student loan is finalized.
a)  Grczce perz.od refers to the period during which no loan repayments are due and demandable.
(c)  /#feres'f rare refers to the charge paid by the student-borrower for the use of the loan.
(d)  £ocz# ¢"ow#f refers to the total amount borrowed by a student-borrower.
(e)  £ocm  frcz#cfee  refers  to  a  portion  of the  loan  amount  disbursed  to  the  student-borrower
according to the disbursement schedule.
®  M¢xz.rmw"  "o#ffo/y  ¢mor/I.zafz.o#  refers  to  the  maximum  monthly  anlortization  that may be
collected from student-borrowers determined at the time the student loan is finalized.
(g)  P¢);"enf  Sched#/e  refers  to  the  schedule  for  loan  repayments  deterinined  at  the  time  the
student loan is finalized.
(h)  Sfwde#f-bo77-owers  refers  to  students  at  the  tertiary  and  graduate  levels  who  avail  of the
HELP.
SEC.  4.  Col;erczge.  -  The  HELP  shall  be  made  available  to  all  Filipino  students  admitted  to  or
enrolled  at  any  higher  educational  institution  accredited  by  the  Commission  on  Higher  Education
(CHEd).
SEC.  5. Ivafure a/£o¢# Progrczm.  -The  HELP  is  a personal  loan program  for student-borrowers
designed  to  augment their financial  resources  for  tuition  fees  and  education-related  expenses.  The
HELP shall be offered through the Development Bank of the Philippines (DBP) and the Land Bank of
the Philippines (LBP).


SEC.  6.  £ocm  Feczfwre5'.  -  The  HELP  Council  shall  promulgate  guidelines  consistent  with  the
following principles:
(a)  -4chpfc!bz./I.fy -The HELP Council shall determine the appropriate circumstances wherein loan
terms may be renegotiated. The HELP Council shall also provide guidelines for prepayment.
In both cases, the HELP Council shall endeavor to promote the welfare of student-borrowers.
(b)  j4Jj7rordebz./I.ty - The HELP  Council  shall determine the maximum monthly  amortization  for
loans under the HELP after considering the prevailing monthly wage and salary rates in the
country. The maximum monthly amortization shall not exceed twenty-five percent (25%) of
the prevailing monthly wage and salary rates.
/cJ  Co//ecf¢bz./I.ty  -  The  HELP  Council  shall  provide  guidelines  for  effective  loan  collection
mechanisms.  The HELP Council may seek the assistance of other government agencies and
government-owned and controlled corporations to ensure repayment. The HELP Council may
explore  repayment  through  the  Social  Security  System  (SSS)  or  the  Government  Service
Insurance   System   (GSIS).   The   HELP   Council   may   also   explore   inforination   sharing
agreements between the DBP, LBP, and the Credit Information Corporation (CIC) to build
the credit history of student-borrowers. The credit history of student-borrowers shall be made
accessible to other financial institutions through the CIC.
(d)  F/exz.bz./I.fy - The HELP Council shall provide guidelines in determining an appropriate grace
period for student-borrowers. In determining an appropriate grace period, factors such as the
expected  amount  of time  until  completion  of degree  and  expected  amount  of time  for job
search, among others, shall be considered.
(e)  £o#g~rerm - All loans shall have a minimum payment period of five (5) years, excluding the
grace  period.  The  HELP  Council  shall  provide  guidelines  in  determining  an  appropriate
maturity date.
(I)   Performcz7¢ce-Based - The HELP Council shall provide guidelines to ensure that the release of
loan  proceeds  is  done  in  tranches.  Student-borrowers  shall be  required to  submit proof of
eurollment at the start of each academic term to secure the release of loan tranches.
(g)  P7ied!.cf¢bz./!'fy -The RELP Council  shall ensure that all  loans under IHLP  shall have  fixed
terms. These terms shall cover, but are not limited to, the following:
a.    Loanamount
b.    Disbursement schedule
c,    Interest rate
d.    Graceperiod
e.    Monthly amortization
f.     Payment schedule
SEC.  7.  Z7E4P  Cow#cz./.  -  There  shall  be  a  HELP  Council,  an  inter-agency  body,  whose  primary
responsibility is to set the policy direction and guidelines for the HELP. The HELP Council shall be
chained by the CHEd and shall have the following members:
(a)  President and CEO of the Land Bank of the Philippines;
(b)  President and CEO of the Development Bank of the Philippines;
(c)  Governor of the Bangko Sentral ng Pilipinas;
(d)  Secretary of the Department of Finance;
(e)  Director-General of the National Economic and Development Authority
(I)   President and CEO of the Social Security System;
(g)  President and General Manager of the Government Service Insurance System; and


(h)  President of the Credit Information Corporation.
SEC.  8.  Jmp/emc7Ifz.7cg  Rw/es  cr#c7 Rcgit/¢fz.o#s.  -  The  HELP  Council  shall  formulate  the  rules  and
regulations for the effective implementation of this Act within one (1) month of its effectivity.
SEC.  9.  Repecz/i'ng  C/czwse.  -  All  laws,  decrees,  executive  orders,  rules  and  regulations  or  parts
thereof, which are inconsistent with this Act, are hereby repealed, amended or modified accordingly.
SEC  10.  Sepczrabi./I.ty  C/cz#se.  - If any provision  of this  Act  is  held unconstitutional  or  invalid,  all
other provisions not affected thereby shall remain valid.
SHC.11. Ejrecfz.vz.ty. -This Act shall take effect fifteen (15) days after its publication in the Q#}cz.a/
Gclze/fe or in a newspaper of general circulation.
Approved,