FIFTEENTH CONGRESS OF THE REPUBLIC) 
OF THE PHILIPPINES 
) 
First Regular Session 
) 
SENATE 
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Senate Bill No. 487 
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INTRODUCED BY SEN. JINGGOY EJERCITO ESTRADA 
EXPLANATORY NOTE 
This bill seeks to create a National Student Loan Board to implement a 
National Student Loan Program for the poor, define its powers and functions and 
appropriate the necessary funds. 
The importance of providing access to higher education for the poor 
cannot be overemphasized. In the Philippines, only a little over 11 % of our work 
force has a college education. Of the college age population, less than 50% are 
enrolled in tertiary educational institutions and about 70% are living below the 
poverty line. 
Under this proposed measure, the cross-subsidy program implemented by the 
University of the Philippines (UP.) will be replicated on a nationwide scale. As 
such, under this proposed measure, a mandatory monthly contribution shall be 
made by persons within specific income brackets and that such fund collected 
shall go into the national student loan fund. These contributions will be graduated 
according to income 
Indubitably, there is a great need to provide a national student loan 
program to assist the poor and the needy by giving them access to tertiary 
education. Indeed, we will only be able to attain our vision of becoming the next 
economic tiger of Asia by educating the less fortunate of our Filipino people. 
In view of the foregoing, the passage of this bill is earnestly requested. 
Senator 


FIFTEENTH CONGRESS OF THE REPUBLIC) 
OF THE PHILIPPINES 
) 
First Regular Session 
) 
'SENATE 
Senate Bill 'No. -4 8 7 
INTRODUCED BY SEN. JINGGOY EJERCITO ESTRADA 
AN ACT 
CREATING A NATIONAL STUDENT LOAN BOARD TO IMPLEMENT A 
NATIONAL STUDENT LOAN PROGRAM FOR THE POOR, DEFINING ITS 
IMPLEMENTING 
GUIDELINES, 
RULES 
AND 
REGULATIONS 
AND 
APPROP~IATING FUNDS THEREFOR 
Be it enacted by the Senate and the House of Representatives of the Philippines 
in Congress assembled: 
SECTION 1. Short Title. - This Act shall be known as the "National 
Student Loan Program for the Poor Act of 2010." 
SEC. 2. Creation. - There shall be created, under the Office of the 
President of the Philippines, in close coordination with the Department of 
Education (DepEd) and the Department of Social Welfare and Development 
(DSWD), a National Student Loan Board to implement a National Student Loan 
Program for the Poor. 
SEC. 3. Definition of Terms. - For the purpose of this Act, the following 
terms shall have the corresponding meaning: 
a) fskolar ng Bayan - hereinafter called "Iskolar" shall refer to a qualified 
beneficiary who draws from the National Student Loan Fund to support his or her 
tertiary education; 
b) National Student Loan Fund - hereinafter called the "Fund" shall refer to 
a cross-subsidy benefit fund to be collected by the National Government and lent 
to qualified Iskolars as hereinafter defined; 
c) National Student Loan Board - hereinafter called the "Student Loan 
Board" shall refer to a governing' body under the Office of the President tasked to 
implement the provisions of this Act; 
d) Board of Directors - hereinafter called the "Board shall refer to the 
governing body of the Student Loan Board and shall exercise the powers and 
duties hereinafter defined; 
e) Monthly Contributions - hereinafter called "contributions" shall refer to 
the contributions of designated, income earners to the Fund, based on the 
National Economic Development Administration (NEDA) incom'e brackets; 


f) 
Iskolar Brackets -
hereinafter called "brackets" shall refer to a 
beneficiary classification system wherein Iskolar ng Buyulan shall be ranked 
according to the annual family income and/or academic performance in an 
immediately previous school term. 
SEC. 4. Composition of the Board. - The National Student Loan Board 
created under this Act shall be composed of the following members: 
1) 
Chairperson - The Secretary of the Department of Education 
(DepEd), or his/her duly designated representative who should 
be an Undersecretary, shall be the Chairperson of the National 
Student Loan Board. The Secretary of the DECS shall receive 
per diems to be paid for attendance in regular and emergency 
meetings called by the Board. 
2) 
Vice Chairman - The Secretary of the Department of Social 
Welfare and Development (DSWD), or his/her duly designated 
representative who should be an Undersecretary, shall be the 
Vice Chairman of the National Student Loan Board. The 
Secretary of the DSWD shall receive per diems to be paid for 
attendance in regular and emergency meetings called by the 
Board. 
3) Executive Director of the Student Loan Board - There shall be an 
Executive Director of the Student Loan Board to be appointed by the President of 
the Philippines. The Executive Director must be a natural born citizen of the 
country, and must have passed the Career Executive Service Officers (CESO) 
examination. The Executive Director shall receive a monthly compensation 
. equivalent to salary grade 28. The Executive Director shall serve a term of three 
(3) years and can be reappointed for another one (1) term. 
4) Working Board Members - There shall be ten (10) Working Board 
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 President of the Philippines. Each Working Board 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 Student Loan Board. The erm of the Working Board Members shall be co-
terminus with the term of the Executive Director. 
5) Ex-Officio Board Members - The Chairpersons of the Government 
Insurance Service System (GSIS), the Social Security System (SSS), the 
Philippine Overseas Employment Agency (POEA) and the Executive Director of 
the Student Loan Board shall be ex-officio members of the Board. They shall 
receive per diems to be paid for attendance in regular and emergency meetings 
called by the Board. The ex-officio members of the board shall have no power to 
vote. 
SEC. 5. Powers and Functions of the National Student Loan Board. -
The powers and functions of the Board shall be as follows: 
a) To closely coordinate with NEDA in determining the income brackets 
and monthly contributions to the Fund; 
b) To promUlgate the necessary guidelines, rules or regulations for the 
lending of funds for education td the poor; 


c) To appoint the necessary staff and/or employees for the National 
Student Loan Board; 
d) To allocate and disburse funds for the education of the poor; 
e) 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; 
g) 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; 
h) To report to the Office of the President on a monthly basis; and 
i) To perform such other powers and functions as may be deemed 
necessary by the President of the Philippines, pursuant to the provisions of this 
Act. 
SEC. 6. Meetings of the Board. - The National Student Loan Board shall 
hold twelve (12) regular board meetings every year to be held every first Monday 
of the month. The Chairperson of the Board shall be the presiding officer. In the 
absence of the Chairperson, the Vice-Chairperson of the Board shall 
automatically take over. 
SEC. 7. Quorum for National Student Loan Board Meetings. - All 
regular and emergency meetings shall only be convened with a quorum of at 
least fifty percenturn (50%) plus one (1) of the regular Board Members. All 
meetings convened without the said quorum shall be deemed null and void. 
SEC. 8. Executive Committee of the Loan Board. - There shall be 
created an Executive Committee of the National Student Loan Board composed 
of the Executive Director and the ten (10) Working Board Members. 
The Executive Committee, headed by the Executive Director shall have 
the following powers and functio~s: 
a) To recommend the approval of loan applications by the Board; 
b) To review, evaluate and assess programs, plans of action and/or 
agenda of the Board; 
c) To review, evaluate and assess the academic standing of loan 
borrowers; 
d) To implement the orders, rules, regulations and guidelines passed by 
the Board; 
e) To conduct annual spot and random inspections on borrowers; 
f) To conduct studies and researches for the improvement of educational 
services for the poor; 
g) To reprimand, suspend or dismiss erring officials and employees of the 


Student Loan Board based on the existing rules and regulations of the Civil 
Service Commission; 
j) To appoint the necessary staff and/or employees for the Executive 
Committee of the National Student Loan Board; 
k) To recommend the cancellation or revocation of loans; and 
I) To perform such other powers and functions as may be determined by 
the Board. 
SEC. 9. Student Loan Board Staff Employees. - The National Student 
Loan BO.ard shall determine the number of staff / employees needed to carry out 
the functions of the Student Loan Board, subject to the rules and regulations of 
the Civil Service Law and rules. The Commission shall likewise provide for the 
qualifications and compensation of applicants based on the existing rules and 
regulations on the hiring of civil servants. 
SEC. 10. Planning Model. - For purposes of developing the relevant 
implementing details of the National Student Loan Program, the Board shall use 
as a principal reference the Socialized Tuition Fee Assistance Program (STFAP) 
of the University of the Philippines. 
SEC. 11. Contributions. - AI1 monthly contributions made to the Fund 
shall be deposited by the Board in the Development Bank of the Philippines 
(DBP) under the name of the National Student Loan Fund. 
SEC. 12. Investment Portfolio. - Funds in excess of the annual operating 
requirements of the StUdent Loan Board not covered by its allocation under the 
General Appropriations Act shall be transferred to an Investment Portfolio Fund. 
The interest to be derived out of the investment Portfolio shall be used to fund full 
scholarships for qualified Isko/ars in academic institutions of their choice: 
Provided, That such educational institutions are duly accredited by the DepED 
are included in a list of qualified tertiary educational institutions prepared by the 
Board for this purpose. 
SEC. 13. Contributor Income Bracket. - The Director-General of the 
National Economic and Development Authority (NEDA) is hereby directed to 
assist the Board in determining the income brackets of wage earners who shall 
be required to make contributions to the Fund within ninety (90) days after the 
effectivity of this Act. 
The contribution structure shall be progressive, from a minimum of %% of 
individual income bracket to a maximum of 4% of individual income bracket. 
SEC. 14. BenefiCiary Loan Amount. - The loan available to an Iskolar 
shall be semestral, and shall be subject to the following terms and conditions: 
a) Availability - Iskolar ng Bayan loans shall be available only for 
undergraduate degree courses. This program shall not cover postgraduate 
courses. 
b) Loan size - loan amount shall be equivalent to the prevailing cost per 
academic unit at the University of the Philippines multiplied by twenty one (21) 
academic units. 


• 
c) Loan repayment - loans shall carry an annual interest rate of 5%, 
payable over five (5) years commencing the first year after the graduation of the 
Iskolar. Loan amortization computation shall use the Straight-Line Method. 
Amortizations shall be deductible' from salary in the case of employed graduate 
Iskolar or paid directly to the Fund in the case of self-employed graduate of 
Iskolars. 
d) Application - the loan shall be applicable to the school of choice of the 
Iskolar, to cover tuition and living allowance. Amounts in excess of the loan 
needed to cover the Iskolar's needs shall have to be derived from other sources. 
e) Drawdown - Upon approval of a loan, an amount equivalent to the 
tuition of the Iskolar can immediately b 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. 15. Mandatory Contributions. - All income earners as determined 
under Section 9 above are hereby required to contribute to the Fund. Such 
mandatory contribution shall be based on NEDA income brackets. 
SEC. 16. Loan Repayments. - The Chairpersons of the Government 
Service Insurance System (GSIS), the Social Security System (SSS), the Civil 
Service Commission (CSC), the Department of Labor and Employment (DOLE) 
and the Philippine Overseas Employment Agency (POEA) are hereby directed to 
closely coordinate with the Board to determine the present occupational status of 
borrowers for purposes of loan repayments to the fund. 
SEC. 17. Tax Deductibility. - All contributions made to the Fund shall be 
deductible from taxable personal income. All loan repayments of graduate 
beneficiaries shall likewise be deductible from taxable personal income. 
SEC. 18. Appropriations. - The amount necessary for the effective 
implementation of this Act shall be taken out of the funds appropriated for the 
Office of the President. Thereafter, such amount as may be necessary for the 
continued operations of the Board shall be included in the annual General 
Appropriations Act. 
SEC. 19. Repealing Clause. - All laws, presidential decrees, executive 
orders, proclamations, rules and regulations which are inconsistent with the 
provisions of this Act are hereby \epealed or modified accordingly. 
SEC. 20. Separability Clause. - If, for any reason, any section or 
provision of this Act shall be held unconstitutional or invalid, the other section or 
provision,not otherwise affected shall remain valid. 
SEC. 21. Effectivity Clause. - This Act shall take effect fifteen (15) days 
from its publication in the Official Gazette or in at least two (2) newspapers of 
general circulation. 
Approved,