SIXTEENTH CONGRESS OF THE) 
REPUBLIC OF THE PHILIPPINES) 
First Regular Session 
) 
SENATE 
s. B. 
508 
Introduced by SENATOR CYNTHIA VILLAR 
EXPLANATORY NOTE 
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The 1987 Constitution of the Republic of the Philippines provides that the State 
s~all establish and maintain a system of scholarship grants, student loan programs, 
subsidize and other incentives which shall be available to deserving students in both 
public and private school, especially to the underprivileged (Section 2 (3), Article 14, 
1987 Philippine Cosntitution). 
In line with this constitutional provision, the attached bill proposes the creation of 
a National Student Loan Board to Implement a National Student Loan Program. The 
proposed loan program is deSigned to promote democratization of access to 
educational opportunities in post-secondary and tertiary levels to qualified students 
through financial assistance in the form of an educational loan. 
The bill aims to 
establish and maintain a system of student loan program and other incentives that will 
be available to deserving post-secondary and tertiary students in both public and private 
schools, especially the underprivileged. 
If enacted, this student loan program will 
certainly be able to open opportunities towards the realization of a better future to those 
students who, because of poverty or financial difficulty, have been denied access to 
pursue further education. 
I recommend the early approval of this bill. 


SIXTEENTH CONGRESS OF THE) 
REPUBLIC OF THE PHILIPPINES) 
First Regular Session 
) 
SENATE 
S. B. 508 
Introduced by SENATOR CYNTHIA VILLAR 
AN ACT 
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JUL -8 A 8 :08 
"yf 
CREATING A NATIONAL STUDENT LOAN BOARD TO IMPLEMENT A 
NATIONAL STUDENT LOAN PROGRAM FOR POST SECONDARY AND 
TERTIARY EDUCATION, APPROPRIATING FUNDS THEREFOR, AND 
FOR OTHER PURPOSES 
Be it enacted by the Senate and House of Representatives of the Philippines in 
Congress assembled: 
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Section 1. Short Title. - This Act shall be known as the "National Student Loan 
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Program Act of 2013." 
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Sec. 2. Declaration of Policy. -
It is the declared policy of the State to protect 
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and promote the right of all citizens to quality education at all levels and shall take 
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appropriate steps to make such education accessible to all. Further, it is a declared 
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State policy to establish and maintain a system of scholarship grants, student loan 
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programs, subsidies, and other incentives which shall be available to deserving 
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students in both public and private schools, espeCially to the underprivileged. For these 
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reasons, the National Student Loan Program is hereby established to provide for a more 
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effective loan assistance program, and to institute a system for efficient loan collection. 
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Sec. 3. Definition of Terms. -
For purposes of this Act, the following terms shall 
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mean: 
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(a.) 
National Student Loan Program refers to the government educational loan 
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program which shall be designed to promote democratization of access to 
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educational opportunities in post-secondary and tertiary levels to qualified 
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students through financial assistance in the form of an educational loan; 
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(b.) 
National Student Loan Fund, hereinafter called the "Fund," refers to a 
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cross-subsidy benefit fund to be collected by the National Government 
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and lent to qualified borrowers as hereinafter defined; 
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(c.) 
National Student Loan Board, hereinafter called the "Loan Board," refers 
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to a governing body under the Office of the President tasked to formulate 
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policies, 
guidelines and rules and regulation for the operation, 
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management and supervision of the national student loan fund for the 
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National Student Loan Program and to implement the provisions of this 
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Act; 
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(d.) 
Student Loan Borrower refers to a qualified beneficiary who draws from 
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the National Student Loan Fund to support his or her post-secondary or 
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tertiary education; 
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(e.) 
Deserving Students refers to students qualified under this Act and who 
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have the ability to continue and finish a post secondary or tertiary 
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education: Provided, that they are currently enrolled or intend to enroll in 
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any of the priority courses subsequently identified and determined by 
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CHED and TESDA; 
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(f.) 
Delinquent Borrower refers to a student-borrower under the National 
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Student Loan Program who has not paid in full for a period of three and a 
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half years after graduation and gainful employment; 
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(g.) 
Post Secondary Education refers to the education and training in non-
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degree vocational and technical courses offered 
in post-secondary 
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vocational and technical education institutions, or education in degree 
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courses offered by higher educational institutions, the completion of which 
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are attested by a certificate or diploma issued by or with permission of the 
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Technical Education and Skills Development Authority (TESDA); 
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(h.) 
Tertiary Education refers to the education and training in degree programs 
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offered in higher education institutions, the completion of which are 
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attested by the Commission on Higher Education (CHED); 
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. (i.) 
Tuition 
Fee refers to the fees representing direct cost of instruction, 
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training and other related activities and for the student's use of the 
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instruction and training facilities; 
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(j.) 
Miscellaneous Fees and Other School Fees refers to those fees which 
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cover other necessary costs supportive of instruction, including, but not 
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limited to medical and dental, athletic, library and laboratory fees; 
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(k.) 
Educational Expenses refers to the expenses related to the education of 
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the student, such as books, subsistence and board and lodging, but 
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excluding tuition and miscellaneous and other school fees; 
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(I.) 
Clearance refers to the certification issued by the National Bureau of 
Investigation indicating whether or not the student borrower has fully paid 
the loan. 
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SEC. 4. National Student Loan Board. - To carry out the purposes of this Act, there 
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shall be created, a National Student Loan Board to implement a National Student Loan 
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Program for deserving students. This Board will be under the Office of the President of 
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the Philippines, but in close coordination with the Commission on Higher Education 
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The National Student Loan Board, hereinafter referred to as the Loan Board, 
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shall be a governing 
body that shall formulate policies, guidelines, and rules and 
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regulations necessary for the operation, management and supervision of the National 
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Student Loan Fund and the National Student Loan Program for Post Secondary and 
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Tertiary Education. 
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SEC. 5. Composition of the Loan Board. - The Loan Board created under this Act 
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shall be composed of the following members: 
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1) 
The Chairperson of the Commission on Higher Education, as Chairperson 
of the National Student loan Board; 
2) 
The Director-General of the Technical Education and Skills Development 
Authority, as Co-Chairperson; 
3) 
The Secretary of the Department of Social Welfare and Development 
(DSWD), as the Vice Chairperson; 
4) 
The Secretary of the Department of labor and Employment, as Member; 
5) 
The Secretary of the Department of Finance, as Member; 
6) 
The Chairperson of the House' Committee on Higher & Technical 
Education, as Member; 
7) 
The Chairperson of the Senate Committee on Education, Arts and Culture, 
as Member; 
8) 
The Director-General of the National Economic and Development 
Authority (NEDA), as Member; 
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The Commissioner, Bureau of Immigration, as Member; 
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The President, Government Service Insurance System, as Member; 
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The President, Social Security System, as Member; 
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The Director of the National Bureau of investigation, as Member; 
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The President, Philippine Association of State Universities and Colleges 
(PASUC), as Member; 
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The President, Coordinating Council of Private Educational Associations, 
as Member; and 
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The President, Association of local Colleges and Universities, as 
Member. 
SEC. 6. Compensation of the Loan Board. - The members shall serve without 
compensation, but they shall be entitled to per diems and be reimbursed for necessary 
expenses incurred in their attendance of meetings of the loan Board or in connection 
with their official business authorized by resolution of the loan Board, subject to existing 
laws and regulations. 
SEC. 7. Powers and Functions of the Loan Board. - The powers and functions of 
the Loan Board shall include the following: 
a) 
To primarily manage, administer and supervise the National Student Loan 
Fund for the National Student Loan Program, including the allocation and 
disbursement of funds to implement the program; 
b) 
To allocate and disburse funds for the education of qualified student 
borrowers; 
c) 
To closely coordinate with NEDA in determining the income brackets of 
Filipino families for the purpose of identifying qualified student borrowers; 
d) 
To closely cOordinate with CHED and TESDA in determining the 
qualifications of student borrowers for degree and non-degree courses in 
various post secondary and tertiary educational institutions; 
e) 
To closely coordinate with the Bangko Sentral ng Pilipinas in determining 
delinquent loan borrowers and setting up a mechanism for blacklisting 
them should they apply for loans or credit cards from banks; 
f) 
To promulgate the necessary guidelines, rules or regulations for the 
lending of funds for the education of qualified student borrowers; 
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To plan, implement and monitor annual work programs, as well as 
evaluate, and submit annual reports in pursuance of the objectives of this 
Act; 
To conduct investigation, receive documentary proof, and determine who 
are the eligible students based on the provisions in this Act; 
To institute a system within the National Bureau of Investigation that shall 
state in the NBI clearance issued to the applicant whether or not he or she 
has unpaid loans from the National Student Loan Program; 
To plan and implement a program of generating funds for the loan 
program to finance the education of students who qualify under the 
provisions of this Act: Provided, however, That the distribution of loans to 
the various cities and provinces shall be in proportion to their population: 
Provided, further, That support for student recipients shall be given until 
they finish their course of study; Provided, finally, that student debtors 
shall not be entitled to financial aid for subjects that they repeat on 
account of failure or dropping of subjects; 
To receive donations, legacies, gifts and other forms of contribution, 
whether in cash or in property, from both public and private sources here 
and abroad, which shall accrue to the special fund created under this Act, 
and to receive and utilize the services and assistance of experts: 
Provided, that such donations, legacies and contributions shall be exempt 
from taxation and shall be allowable deductions for income tax purposes; 
To be the repository of data and information about student borrowers 
under the National Student Loan Program; 
To maintain and regularly update every six (6) months, the lists of qualified 
student loan borrowers and the priority courses being offered in public and 
private post secondary and tertiary .educational institutions; 
To issue certificates which shall be valid anywhere in the country as proof 
of the eligibility of the student loan borrower to avail himself/herself of the 
loan program; 
To cancel the certificates issued based on the grounds under Section 21 
thereof; 
To appoint the necessary staff and/or employees of the Loan Board; 
To cancel, suspend, or revoke loans in cases of deceit, fraud or cheating 
of any kind on the part of the borrower; 
To be the trustees for the Investment Portfolio of the Fund, which shall be 
created out of its excess over semestral operating and lending 
requirements; 
To appoint an investment manager for the Investment PortfoliO, should it 
be deemed necessary: Provided, That such appointment should not 
exceed three (3) years, and subject to performance review prior to 
renewal; 
To reprimand, suspend or dismiss erring officials and employees of the 
Loan Board based on the existing rules, regulations and guidelines 
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u) 
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passed by the Loan Board and the rules and regulations of the Civil 
Service Commission; 
To report to the Office of the President on a monthly basis; and 
To perform such other powers and functions as may for the effective 
implementation of this Act. 
SEC. 8. Term of Office. - The members of the Loan Board shall hold office for a 
term of three (3) years after their appointment or until their successors shall have been 
appointed or qualified. Should a member of the Loan Board fail to complete the term, a 
successor shall be appointed by the President for the unexpired portion of the term. 
SEC. 9. Meetings of the Loan Board. - The Loan Board shall hold twelve (12) 
regular board meetings every first Monday of the month. The Chairperson of the Loan 
~oard may call a special meeting when necessary: Provided, That the members are 
notified in writing at least three (3) working days prior to said meeting. As Chairperson 
of the Loan Board, the chairperson of the CHED shall be the presiding officer during 
board meetings. In the absence of the Chairperson of the CHED, aCHED 
Commissioner duly deSignated by him/her shall represent him/her in the meeting with all 
the rights and responsibilities of a regular member: Provided, however, That during this 
meeting, the Director-General of the TESDA, who is the Co-Chairperson of the Loan 
Board, shall be the Presiding Officer: Provided, further, that in the absence of both the 
Chairperson and the Co-Chairperson, the DSWD Secretary, who is the Vice-
Chairperson of the Loan Board, shall act as the Presiding Officer. 
SEC. 10. Quorum for Loan Board Meetings. All regular and emergency meetings 
shall only be convened with a quorum of at least fifty percentum (50%) plus one (1) of 
the regular Loan Board Members. All meetings convened without the said quorum shall 
be deemed null and void. 
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SEC. 11. The Executive Committee of the Loan Board. - There shall be created 
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an Executive Committee of the Loan Board, which shall serve as the secretariat to carry 
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. out the functions of the Loan Board. It shall be composed of the Executive Director and 
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ten (10) Executive Committee Members. 
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S3 
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SEC. 12. Powers and Functions of the Executive Committee. - The Executive 
Committee, headed by the Executive Director, shall have the following powers and 
functions: 
a) 
b) 
c) 
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To recommend the approval of loan applications by the Loan Board; 
To review, evaluate and assess programs, plans of action and/or agenda 
of the Loan Board; 
To implement the orders, rules, regulations and guidelines passed by the 
Loan Board; 
To plan, implement and monitor annual work programs and to evaluate 
and submit annual reports to the Loan Board in pursuance of the 
objectives of this Act; 
To conduct investigation, receive documentary proof and determine who 
are qualified or eligible to avail themselves of the National Student Loan 
Program based on the provisions of this Act; 
To maintain, update and submit to the Loan Board all data concerning the 
loan program and its beneficiaries; 
To reView, evaluate and assess the academic standing of loan borrowers 
on a regular basis for submission to the Loan Board; 
To conduct annual spot and random inspections on borrowers and to 
determine their credit standing and whereabouts after graduation; 
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To issue certificates, upon approval of the Loan Board, which shall be 
valid anywhere in the Philippines as proof of the eligibility of the student 
loan borrower who will avail himself/herself of the National Student Loan 
Program; 
To recommend the cancellation of certificates and/or revocation of loans; 
and 
To perform such other powers and functions as may be determined by the 
Loan Board. 
SEC. 13. Executive Director of the Executive Committee of the Loan Board. -
The Loan Board shall appoint an Executive Director who shall head the Executive 
Committee of the Loan Board. He/She must be a natural-born citizen of the Philippines 
and must be a holder of Career Executive Service Officers (CESO) eligibility. 
The Executive Director shall receive a monthly compensation equivalent to salary 
grade 28. He/She shall serve a term of three (3) years and can be reappointed for 
another term. 
SEC. 14. Executive Committee Members. - There shall be ten (10) Executiive 
Committee Members, eight (8) members of whom shall come from the State 
Universities and Colleges, and two (2) from the private sector, all of whom shall be 
aPPointed by the National Student Loan Board. Each Executive Committee Member 
shall receive a monthly compensation equivalent to salary grade 26 and shall have the 
organizational designation of "Managing Director" of a specific functional area of the 
Loan Board. The term of the Executive Committee Members shall be coterminous with 
that of the Executive Director. 
SEC. 15. Loan Board Staff/Employees. -
The Loan Board shall determine the 
number of staff/employees needed to carry out the functions of the Board, subject to 
Civil Service rules and regulations. The Civil Service Commission shall likewise provide 
for the qualifications and compensation of applicants based on existing rules and 
regulations on the hiring of civil servants. 
SEC. 16. National Student Loan Trust Fund.- The Loan Board shall establish a 
Loan Trust Fund for CHED and TESDA to cover the tuition, miscellaneous and other 
school fees and other educational expenses of the student borrower under the National 
Student Loan Program. The amount derived from loan repayments of borrowers, which 
include payment for the principal and interests, shall accrue to the Loan Trust Fund. 
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SEC. 17. Loanable Amount. - The Loan Board shall determine the maximum 
amount that can be availed of by student loan borrowers. Educational loans under this 
Act may cover matriculation and other school fees and educational expenses for books, 
subsistence, and board and lodging: Provided, that amounts covering payments for 
tuition and other school fees shall be paid directly to the school concerned. 
The loans available to student borrowers shall be subject to the following terms 
and conditions: 
a) 
Availability -
Loans under the National Student Loan Program shall be 
available for post-secondary non-degree and undergraduate degree 
programs under the TESDA and tertiary or degree programs under the 
CHED, respectively. This program shall not cover postgraduate courses; 
b) 
Loan Size - The loanable amount shall be equivalent to the prevailing cost 
per academic unit at the University of the Philippines multiplied by twenty-
one (21) academic units or subject to the decision of the Loan Board; 
c) 
Loan Applicability - The loan shall be applicable to the school of choice of 
the student loan borrower, whether it is a public or private school offering 
post secondary technical or vocational courses or college degree 
programs, to cover tuition fees and living allowance. Amounts in excess of 
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the loan needed to cover the student borrower's needs shall have to be 
derived from other sources. 
d) 
Drawdown - Upon approval of a loan, an amount equivalent to the tuition 
of the student loan borrower can immediately be drawn upon presentation 
of proof of registration. Balance can be drawn in five (5) equal monthly 
installments starting the first month of the semester in the case of schools 
using the semestral system, or four (4) equal monthly installments starting 
the first month of the trimester in the case of schools using the trimestral 
system. 
SEC. 18. Interest Rate and Loan Collection Scheme. - In the formulation of 
policies regarding the interest and loan repayment or collection scheme for the N~tional 
Student Loan Program, the following principles must be observed: 
a) 
Any loan granted shall be paid by the student-debtor after he has finished 
the course or profession for which the proceeds of the loan were 
expended, but only after a period of two (2) years from the time he has 
acquired gainful employment: Provided, That the government shall 
endeavor to give priority to students under the program in obtaining 
possible employment. 
b) 
Voluntary repayment of loans shall start anytime the loan borrower wants 
to pay even before finishing the course or having gainful employment: 
Provided, That a reduced rate of five percent (5%) per annum shall apply; 
c) I 
nterest at the rate of not more than five percent (5%) per annum shall be 
applied to the loan or the balance thereof. The Loan Board shall formulate 
a loan collection scheme table as guide of the deputized bank and all 
concerned agencies in computing interest rates; and 
d) 
The NBI shall determine the employment status and whereabouts of the 
delinquent loan borrowers for clearance application and/or renewal. 
SEC. 19. Qualification Requirements of Applicant. -
A student eligible under 
this Act shall have the following entry requirements: 
1 ) 
Filipino citizen; 
2) 
Currently enrolled or intend to enroll in any of the courses to be 
determined by CHED or TESDA; 
3) 
Has parents or guardians with a gross annual income to be determined 
by the NEDA income bracket; 
4) 
Has stopped schooling for more than one year due to valid reasons, but 
intends to return to school to finish the remaining semesters required by 
the course or program; and 
5) 
Does not enjoy any scholarship or study grant. 
SEC. 20. Umitations. - The right of any qualified student to avail himself of the 
loan assistance under this Act shall not apply when: 
(1 ) 
He/she fails for one (1) school year in the majority of the academic 
subjects in which he has enrolled during the course of his study unless 
such failure is due to some valid cause beyond his control; 
(2) 
He/she has been declared absent without official leave (AWOL) or is 
permanently 
disqualified or expelled from the educational institution 
where he is enrolled in; 
(3) 
He/she stops schooling for one (1) school year unless such is due to some 
valid cause beyond his control; and 
(4) 
He/she is convicted of any crime. 
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SEC. 21. Implementing Rules and Regulations. - The CHED and TESDA shall, 
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within sixty (60) days from the effectivity of this Act, issue such rules and regulations 
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necessary for the proper implementation of this Act. 
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SEC. 22. Appropriations. - There is hereby appropriated the amount of Pi billion 
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(Pi ,000,000,000.00) out of the funds in the National Treasury, not otherwise 
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appropriated, to be used to finance the National Student loan Program to carry out the 
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provisions of this Act. Thereafter, such sum as may be necessary for its continued 
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implementation shall be included in the Annual General Appropriations Act. 
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SEC. 23. Repealing Clause. - All laws, presidential decrees, executive orders, 
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proclamations, rules and regulations which are inconsistent with the provisions of this 
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Act are hereby repealed or modified accordingly. 
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SEC. 24. Separability Clause. - If any proVision of this Act is held invalid or 
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unconstitutional, other provisions not affected shall continue to be in full force and 
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effect. 
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SEC. 25. Effectivity. This Act shall take effect fifteen (15) days after its complete 
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publication in at least two (2) newspapers of general circulation. 
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Approved, 
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