NINETEENTH CONGRESS OF THE
) 
REPUBLIC OF THE PHILIPPINES
) 
First Regular Session      
HOUSE OF REPRESENTATIVES 
HOUSE BILL NO. ____ 
____________________________________________________________________________ 
Introduced by REPRESENTATIVE RON P. SALO 
____________________________________________________________________________ 
Non-stock savings and loan associations (NSSLAs) used to be informal savings 
and credit institutions that are prevalent in developing countries and among immigrant 
communities in some developed countries. Groups of individuals within a confined 
group, i.e., professional or institutional, voluntarily pool their savings for investment 
and as a source of credit. The existence of NSSLA is brought about by diverse financial 
market failures that are deemed common in poorer countries. For instance, those under 
lower income tax brackets face credit constraints due to the absence of collateral. Its 
system proved to be effective especially for those who are resistant to formal financial 
institutions. Over decades, NSSLAs grew not just in membership, but also in transaction 
value, prompting legislators to effect regulation of the same.  
Currently, NSSLAs in the country are under the jurisdiction of the Bangko Sentral ng 
Pilipinas (BSP) along with other financial institutions such as universal banks, commercial 
banks, thrift banks, rural banks, pawnshop, among others.  Republic Act no. 8367, otherwise 
known as the "Revised Non-Stock Savings and Loan Association Act of 1997", was enacted with the 
view of regulating and supervising the activities of non-stock savings and loan associations in 
order to place their operations on a sound, stable, and efficient basis to the end that they may 
be able to better provide for the establishment of additional savings and credit facilities in a fair 
manner to their members and to curtail or prevent acts or practices of these Associations which 
are prejudicial to their members' interest. 
March 7, 2023
8:00 am
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The law conferred the power of supervision over NSSLAs to the BSP. Under the BSP’s 
jurisdiction, NSSLAs were subjected to various rules and regulations that are similar to those of 
banks. The BSP’s objectives in the imposition of these policies are clear: 1) to effect a change in 
the overall condition and governance of Bangko Sentral-supervised financial institutions (FIs)  
consistent with relevant laws, 2) to mitigate risk to the FIs and stakeholders to maintain stability 
of the financial system. 
While the vision of BSP is motivated by good intentions, it failed to appreciate the true 
meaning and purpose for the creation of NSSLAs. Through the issuance of various rigorous 
rules and regulations, NSSLAs are elevated to the status of a bank – a corporate financial 
institution which is motivated by profit and funded by huge capital. The BSP failed to recognize 
that NSSLAs are essentially self-help institutions powered by hard-working employees, such as 
members of the AFP, the Philippine Navy, and other civilian employees. NSSLAs operate based 
on the concept of mutuality. It has no function except to gather contributions from members 
and utilize the same to justify loans. 
Overly stringent rules discourage individuals to form and register their own associations. 
By requiring the establishment of complex systems within NSSLAs, members would rather 
choose to deposit their money into banks or fail to save at all.  It cannot be stressed enough that 
most NSSLAs do not have the manpower, funding, technical know-how to effect many of the 
processes demanded by the BSP. 
While it is true that NSSLAs are imbued with public interest, being owned and financed 
by the public itself, balance must be struck between the duty to mitigate the risks of the industry 
and the duty to foster an environment that encourages frugality and the culture of saving among 
Filipinos. Failure to recognize the objective for the creation of non-stock savings and loan 
association is detrimental to its existence. 
This Bill aims to transfer jurisdiction of NSSLAs from the Bangko Sentral ng Pilipinas to 
the Securities and Exchange Commission. NSSLAs share more similarities to cooperatives and 


lending companies. Neither of them is placed under the jurisdiction of the BSP.  By conferring 
the authority to SEC, this bill creates a clear distinction between banking institutions and non-
stock savings and loan associations. 
For the foregoing reasons, the passage of this bill is earnestly sought. 
    RON P. SALO 
KABAYAN Party-list 


NINETEENTH CONGRESS OF THE
) 
REPUBLIC OF THE PHILIPPINES
) 
First Regular Session      
HOUSE OF REPRESENTATIVES 
HOUSE BILL NO. ____ 
____________________________________________________________________________ 
Introduced by REPRESENTATIVE RON P. SALO 
____________________________________________________________________________ 
AN ACT 
AMENDING REPUBLIC ACT NO. 8367, OTHERWISE KNOWN AS THE REVISED 
NON-STOCK SAVINGS AND LOAN ASSOCIATION ACT OF 1997, AND FOR 
OTHER PURPOSES 
Be it enacted by the Senate and House of Representatives of the Philippines in Congress assembled: 
SECTION 1: Section 3 of Republic Act no. 8367 is hereby amended as follows: 
“Section 3. Definition of terms. – For the purposes of implementing this 
Act, the following definitions shall apply: 
a) Non-stock savings and loan association shall mean a non-stock, non-
profit corporation engaged in the business of accumulating the savings of
its members and using such accumulations for loans to members to service
the needs of households by providing long term financing for home
building and development and for personal finance;
b) Association shall refer only to non-stock savings and loan associations
organized under this Act and the Corporation Code of the Philippines;
c) Monetary Board shall mean the Monetary Board of the Bangko Sentral
ng Pilipinas; and
7481


d) Bangko Sentral shall mean the Bangko Sentral ng Pilipinas. 
 
SEC.  2: Section 4 of Republic Act no. 8367 is hereby amended as follows Section 4 of 
Republic Act no. 8367 is hereby amended as follows: 
 
“Section 4. Organization of an Association. – At least five (5) but not more 
than fifteen (15) members of a well-defined group as provided herein may 
form an Association under this Act. An Association, prior to transacting any 
business, shall secure a license from the Monetary Board and register with 
the Securities and Exchange Commission (SEC). The application for a license, 
signed by a majority of the incorporators and verified by one of the trustees, 
shall include: 
a) the proposed articles of incorporation and bylaws together with names 
and addresses of the incorporators, trustees and officers, with a statement 
of their character, experience and general fitness to engage in the non-stock 
savings and loan business; 
b) an itemized statement of the estimated receipts and expenditures of the 
proposed Association for the first year; 
c) a filing fee in such amount as may be determined by the Monetary Board 
SECURITIES AND EXCHANGE COMMISSION; and 
d) such other information as the SECURITIES AND EXCHANGE 
COMMISSION Monetary Board   may require. 
The SEC shall not register the articles of incorporation and bylaws of a 
proposed Association unless the application is accompanied by a certificate 
of the Monetary Board approving the same. The Monetary Board THE 
SECURITIES AND EXCHANGE COMMISSION may deny the 
application to organize an Association under this Act if it finds that the 
Association is being organized for any purpose other than to engage in the 
business of a legitimate non-stock savings and loan association or that the 
Association's financial program is unsound, or that the proposed members 
are adequately served by one or more existing Associations. 


The Association shall confine its membership to a well-defined group of 
persons and shall not transact business with the general public. A "well-
defined group" shall be defined by the Monetary Board SECURITIES AND 
EXCHANGE COMMISSION, and shall consist of, but not be limited to, 
any of the following: 
(i)         Employees, officers and directors/TRUSTEES of one (1) 
company, including member-retirees; 
(ii)       Government employees belonging to the same department, 
branch or office, including member-retirees, and 
(iii) 
Immediate members of the families (up to second degree of 
consanguinity or affinity), of those falling under paragraphs 
1 and 2 above.  
xxx 
Associations whose articles of incorporation and bylaws were approved 
and registered prior to the effectivity of this Act and which allow 
membership coverage broader than the foregoing definition, shall be 
allowed to continue.  as such, unless otherwise required by the Monetary 
Board. 
The Monetary Board SECURITIES AND EXCHANGE COMMISSION 
may, as circumstances warrant, require Associations mentioned in the 
immediately preceding paragraph to amend their bylaws to comply with 
the concept of a "well-defined group." 
In no case shall the total amount of entrance fees exceed one percent (1%) 
of the amount to be contributed or otherwise paid in by the particular 
member: Provided, that for new members, the said fee shall be based on the 
amount of contribution computed in accordance with the revaluation of the 
assets of the Association. 
No person, association, partnership or corporation shall do business, or 
hold itself out as doing business, as an Association, or shall use the term 
"Savings and Loan Association" or any other title or name tending to give the 
public the impression that it is engaged in the operations and activities of 
an Association, unless so authorized under this Act. 


SEC. 3.  Section 7 of Republic Act no. 8367 is hereby amended as follows: 
 
“Section 7. Powers of Associations. – The Association shall accept deposits 
from and grant loans only to its members, subject to such rules and 
regulations as the Monetary Board SECURITIES AND EXCHANGE 
COMMISSION may promulgate to ensure sound, stable and efficient 
operation: Provided, That no deposits shall be sourced or deducted from 
the loans granted to a member without his or her written consent. 
The loans shall not exceed the members' deposits and contributions in the 
Association, plus twelve (12) months of his regular salaries as the 
Association may allow and/or ninety percent (90%) of the fair market value 
of any property acceptable as collateral on first mortgage that he may offer 
as security: Provided, That no loan shall have the maturity date of more than 
five (5) years, except loans on the security of unencumbered real estate for 
the purpose of home building and home development, which may be 
granted with maturities not exceeding twenty-five  THIRTY (30) YEARS, 
and medium and long-term loans to finance agricultural projects, subject to 
regulations prescribed by the Monetary Board SECURITIES AND 
EXCHANGE COMMISSION: Provided, further, That the treasurer, cashier, 
or paymaster of the office employing a member is required, 
notwithstanding the provision of any existing law, rule and regulation to 
the contrary, to make deductions from his salary, wage, income or 
retirement pension pursuant to the terms of his loan, and all other 
deductions authorized by the member, to remit such deductions to the 
Association concerned, and to collect such reasonable fee for his services as 
may be authorized by rules promulgated by the Monetary Board 
SECURITIES AND EXCHANGE COMMISSION. 
 
xxx 
b) invest its funds in any sound non-speculative enterprises as well as in 
bonds, security, and other obligations issued by the Government of the 
Philippines, or any of its political subdivisions, instrumentalities, or 
corporations including government-owned or -controlled corporations, 
subject to the rules and regulations of the Monetary Board SECURITIES 
AND EXCHANGE COMMISSION. 
 


xxx 
c) allow members to participate in the profits of the Association; 
d) borrow money or incur such obligations not exceeding twenty percent 
(20%) of the total assets of the Association, from any lending institution. 
The Monetary Board, SECURITIES AND EXCHANGE COMMISSION 
may, in meritorious cases, raise the ceiling on the borrowing capacity of an 
Association to an amount not exceeding thirty percent (30%) of its total 
assets: Provided, That any such Association organized by employees of an 
entity or corporation may borrow funds from said entity or corporation but 
not vice-versa: Provided, further, That the number of the Association's 
creditors shall not exceed nineteen (19) at any one time; 
xxx.” 
 
SEC. 4. Section 9 of Republic Act no. 8367 is hereby amended as follows: 
 
“Section 9. Service units. – An Association shall open, maintain and operate 
service units as may be necessary in order to deliver services to its members 
subject to approval of the Monetary Board SECURITIES AND 
EXCHANGE COMMISSION. 
 
SEC. 5. Section 10 of Republic Act no. 8367 is hereby amended as follows: 
 
“Section 10. Agents and salesmen. – No person shall act as an agent or sales 
representative of an Association or operate an agency without obtaining a 
license from the Monetary Board SECURITIES AND EXCHANGE 
COMMISSION. 
xxx.” 
 
SEC. 6. Section 11 of Republic Act no. 8367 is hereby amended as follows: 
 
“Section 11. Merger or consolidation of Associations. – To achieve 
simplicity, economy and efficiency, different associations of one company 
or department or office may merge or consolidate upon approval of the 
Monetary Board SECURITIES AND EXCHANGE COMMISSION.” 
 
SEC. 7. Section 12 of Republic Act no. 8367 is hereby amended as follows: 
 


“Section 12. Trustees. – Only members are eligible as trustees of an 
Association: Provided, That in the case of a merger or consolidation of 
Associations duly approved by the Monetary Board SECURITIES AND 
EXCHANGE COMMISSION , the limitation on the maximum number of 
trustees in a corporation, as provided for in the Corporation Code, shall not 
be applied for a maximum period of three (3) years so that membership in 
the new board may include up to the total number of trustees provided for 
in the respective articles of incorporation of the merging or consolidating 
Associations.” 
 
SEC. 8. Section 13 of Republic Act no. 8367 is hereby amended as follows: 
 
“Section 13. Bond of officers and employees. – All officers and employees 
of an Association who, in the regular discharge of their duties have access 
to money or negotiable securities shall, before entering upon such duties, 
furnish to the employing Association a good and sufficient bond, the form 
and amount of which shall be prescribed by the Monetary Board 
SECURITIES AND EXCHANGE COMMISSION, and providing for 
indemnity to the Association against the loss of money or securities, by 
reason of their dishonesty. 
 
SEC. 9. Section 14 of Republic Act no. 8367 is hereby amended as follows: 
 
“Section 14. Compensation of trustees, officers and employees. – 
xxx 
All increase in the compensation, in any form, of all trustees and trustee-
officers in excess of ten percent (10%) thereof per annum shall require the 
approval of the Monetary Board SECURITIES AND EXCHANGE 
COMMISSION. 
 
SEC. 10. Section 15 of Republic Act no. 8367 is hereby amended as follows: 
 
 “Section 15. Limitations on lending authority. – 
a) xxx 
b) No Association shall directly or indirectly make any loans to any trustee 
or officer of such Association, either for himself or as agent or as partner of 
another, except with the written approval of the majority of the trustees of 


the Association, excluding the trustee concerned: Provided, That the total 
loans, direct or indirect, granted at any one time to such trustees and 
officers shall not exceed twenty percent (20%) of the total capital 
contributions of the Association; in all cases of the credit accommodations 
granted to trustees and officers under this sub Sec., the written approval of 
the majority of the trustees of the Association, excluding the trustee 
concerned, shall be entered upon the records of the Association and a copy 
of such entry shall be transmitted forthwith to the Bangko Sentral. 
SECURITIES AND EXCHANGE COMMISSION. 
xxx.” 
SEC. 11. Section 18 of Republic Act no. 8367 is hereby amended as follows: 
“Section 18. Limitations on investment. – a) No Association at any one time 
shall invest in bonds and securities in a total amount in excess of ten percent 
(10%) of the total assets of such Association without prior written approval 
of the Bangko Sentral. SECURITIES AND EXCHANGE COMMISSION. 
xxx” 
SEC. 12. Section 19 of Republic Act no. 8367 is hereby amended as follows: 
“Section 19. Reserves. – Every Association shall create a withdrawable 
share reserve which shall consist of two percent (2%) of the total capital 
contributions of the members which the Monetary Board SECURITIES 
AND EXCHANGE COMMISSION may increase to a maximum of three 
percent (3%), as the situation warrants. 
xxx” 
SEC. 13. Section 20 of Republic Act no. 8367 is hereby amended as follows: 
“Section 20. Withdrawal by a member. – For the sole purpose of allowing 
an equitable valuation and distribution of assets for withdrawing members, 
an Association shall, upon the effectivity of this Act, impute revalued 
surplus to be added to the withdrawn capital, subject to such rules as the 
Monetary Board SECURITIES AND EXCHANGE COMMISSION may 
prescribe. Such rules shall allow a reasonable period between withdrawal 


of capital and payment of the share of the member from the revalued 
surplus. 
 
SEC. 14. Section 21 of Republic Act no. 8367 is hereby amended as follows: 
 
Section 21. Annual reports by the Association. – Every Association shall, 
within one hundred twenty (120) calendar days after the close of its fiscal 
year furnish the Monetary Board SECURITIES AND EXCHANGE 
COMMISSION and post in any of the Association's bulletin board or in 
any other conspicuous place a copy of its financial statement showing, in 
such form and detail as the Monetary Board SECURITIES AND 
EXCHANGE COMMISSION shall require, the amount and character of 
the assets and liabilities of the Association at the end of the preceding fiscal 
year. 
The 
Monetary 
Board 
SECURITIES 
AND 
EXCHANGE 
COMMISSION may, in addition to the foregoing, require the disclosure of 
such other information as it shall deem necessary for the protection of the 
members of the Association. 
 
SEC. 15. Section 22 of Republic Act no. 8367 is hereby amended as follows: 
 
“Section 22. Regulatory powers over Associations. – Notwithstanding the 
provisions of Sec. 130 of Republic Act No. 7653, the power to regulate the 
operations of any Association by the Monetary Board shall continue and 
consist of the following:  THE SECURITIES AND EXCHANGE 
COMMISSION IS HEREBY EMPOWERED TO ENFORCE THE 
PROVISIONS 
OF 
THIS 
ACT 
AND 
ITS 
IMPLEMENTING 
REGULATIONS, INCLUDING: 
a) xxx 
b) xxx 
c) in requiring all accountable officers and employees of every Association 
to post bonds for the faithful performance of their duties in reasonable sums 
and with such sureties as the Monetary Board SECURITIES AND 
EXCHANGE COMMISSION may require; 
d) xxx 
e) xxx  
f) in conducting such investigations, taking such remedial measures and 
exercising all powers under Republic Act No. 7653 8799, 11232 insofar as 
they are applicable in the enforcement of this Act. 


The Bangko Sentral SECURITIES AND EXCHANGE COMMISSION 
shall have the power to enforce the laws, orders, instructions, rules and 
regulations promulgated by the Monetary Board applicable to 
Associations; to require Associations, their trustees, officers and agents to 
conduct and manage the affairs of the Association in a lawful and orderly 
manner. After due notice and hearing, the Monetary Board SECURITIES 
AND EXCHANGE COMMISSION may revoke or suspend the license of 
any Association, for such period as it determines necessary, particularly 
when the solvency of an Association is imperiled by losses or irregularities, 
and/or when an Association willfully violates any provisions of this Act or 
any rule or regulations promulgated hereunder. 
The director and examiners of the department of the Bangko Sentral 
SECURITIES AND EXCHANGE COMMISSION charged with the 
regulation of Associations are hereby authorized to administer oaths to any 
trustee, officer or employee of any Association or to any voluntary witness 
and to compel the presentation of all books, documents, papers or records 
necessary in his judgment to ascertain the facts relative to the true condition 
of any Association or to any loan. 
 
SEC. 16. Section 23 of Republic Act no. 8367 is hereby amended as follows: 
 
“Section 23. Penalties. – a) The APPLICABLE provisions of THE REVISED 
CORPORATION CODE shall Sec. 34 of Republic Act No. 7653 Republic Act 
no.  apply to any agent, manager, or other officer-in-charge of any 
Association who willfully refuses any lawful examination into the affairs of 
such Association. 
b) The willful making of a false statement or misleading statement on a 
material fact to the Monetary Board SECURITIES AND EXCHANGE 
COMMISSION or to the director of the department of the Bangko Sentral 
charged with the regulation of Associations or to his examiners shall be 
punished in accordance with Sec. 35 of Republic Act No. 7653. Republic Act 
no. 
8799. 
APPLICABLE 
PROVISIONS 
OF 
THE 
REVISED 
CORPORATION CODE. 
c) Whenever any Association, person or entity willfully violates this Act or 
any order, instruction, rule or regulation issued by the Monetary Board 
SECURITIES 
AND 
EXCHANGE 
COMMISSION 
applicable 
to 


Associations, the persons responsible for such violation shall be punished 
in accordance with Sec. 36 of Republic Act No. 7653.  Republic Act no. 8799. 
WITH 
THE 
APPLICABLE 
PROVISIONS 
OF 
THE 
REVISED 
CORPORATION CODE. 
d) xxx
e) xxx
f) Whenever any examiner, officer or employee of the Bangko Sentral
SECURITIES AND EXCHANGE COMMISSION, who is assigned to
examine, assist or render technical service to an Association, overvalues or
aids in overvaluing any security for the purpose of influencing in any way
the action of the Association on any loan or connives or aids in the
commission of the same, he shall be punished by a fine of not more than
Ten thousand pesos (P10,000) or three times the loan amount involved,
whichever is higher, or imprisonment for not more than one (1) year, at the
discretion of the court.”
SEC. 17. Section 24 of Republic Act no. 8367 is hereby amended as follows: 
“Section 24. Annual EXAMINATION fees. – Consistent with the provisions 
of Sec. 28 of Republic Act No. 7653,  SUBJECT  TO THE REGULATONS 
THAT MAYBE 
BE PRESCRIBED BY THE SECURITIES AND 
EXCHANGE COMMISSION, ANY  Association organized under this Act 
may, pursuant to regulations promulgated for the purpose by the Monetary 
Board , be required to contribute to the Bangko Sentral examination fees  to 
be determined by the Monetary Board. 
SEC. 18. Section 25 of Republic Act no. 8367 is hereby amended as follows: 
“Section 25. Implementation. – For the purpose of carrying the objectives 
of this Act, the Bangko Sentral SECURITIES AND EXCHANGE 
COMMISSION is authorized to require the services and facilities of any 
department or instrumentality of the government or any officer or 
employee of any such department or instrumentality.” 
SEC. 19. Section 26 of Republic Act no. 8367 is hereby amended as follows: 


“Section 26. Annual report of the Monetary Board SECURITIES AND 
EXCHANGE COMMISSION. – The Monetary Board SECURITIES AND 
EXCHANGE COMMISSION shall submit a report to the Congress of the 
Philippines as of the end of each calendar year of all the rules and 
regulations promulgated by it in accordance with the provisions of this Act, 
together with the explanations of its reasons therefor.” 
 
SEC. 20. Section 27 of Republic Act no. 8367 is hereby amended as follows: 
 
“Section 28. Applicability of other laws. –REPEALING CLAUSE- ANY  
PROVISIONS 
OF 
EXISTING 
LAWS 
IN 
CONFLICT 
OR 
INCONSISTENT WITH THE PROVISIONS OF THIS ACT SHALL BE 
REPEALED ACCORDINGLY. The provisions of Republic Act No. 7653 
and , Republic Act No. 337, as amended, insofar as they are applicable and 
not in conflict with any provision of this Act, shall apply to Associations 
organized hereunder.” 
 
SEC. 21.  This Act shall take effect fifteen (15) days following the completion of its 
publication in the Official Gazette or in two (2) national newspapers of general 
circulation. 
  
 
Approved,