2025 Guide to SSS Salary Loan Computation: How to Know Your Exact Monthly Payment
Ever wondered how much you’ll really receive — and how much you’ll pay every month — when you apply for an SSS Salary Loan?
You’re not alone. Many SSS members get confused about how their loan computation works, especially with interest, service charge, and pro-rated fees involved.
This guide will show you exactly how the SSS Salary Loan is computed, step by step — so you can estimate your net take-home amount, monthly amortization, and total repayment with confidence.
🧾 What Is the SSS Salary Loan?
The SSS Salary Loan is a short-term loan program by the Social Security System (SSS) for members who need extra funds for emergencies, education, home repairs, or even maternity-related expenses.
It’s one of the most affordable loans available in the Philippines, with an 8% annual interest rate — much lower than most personal or credit card loans.
💡 Why Understanding the Computation Matters
Many applicants assume the loan amount they see in their SSS dashboard is what they’ll actually receive — but after deductions (service charge and pro-rated interest), the net proceeds can be smaller.
By understanding how the computation works, you can:
- Avoid surprises when your loan is released
- Plan your monthly budget properly
- Compare if a 1-year or 2-year loan fits your needs better
- Know when it’s smart to renew or prepay your loan
⚙️ SSS Salary Loan Computation Overview (2025)
Here’s a breakdown of how your salary loan is calculated under the current SSS policy:
| Factor | Description |
|---|---|
| Interest Rate | 8% per annum (based on diminishing principal balance) |
| Loan Terms | 12 months (1-year) or 24 months (2-year) |
| Service Charge | 1% of the approved loan amount (deducted upfront) |
| Pro-rated Interest | Interest charged from approval date up to the end of the following month |
| Late Payment Penalty | 1% per month on unpaid amortization |
| Minimum Loan Amount | ₱1,000 |
| Maximum Loan Amount | ₱25,000 (1-year) / ₱50,000 (2-year) |
| Loan Renewal | Allowed after paying at least 50% of principal |
🧮 Step-by-Step: How SSS Salary Loan Is Computed
Let’s go through each component one by one.
1️⃣ Determine Your Average Monthly Salary Credit (AMSC)
SSS bases your loan amount on the average of your last 12 posted contributions.
For example:
If your average salary credit is ₱20,000 →
1-year loan = ₱20,000
2-year loan = ₱40,000
💡 Tip: The actual amount may be lower if you haven’t reached the contribution requirement yet (36 for 1-year loan, 72 for 2-year loan).
2️⃣ Deduct the Service Charge (1%)
SSS automatically deducts a 1% service charge upon loan release.
Example:
₱40,000 × 1% = ₱400
Net proceeds = ₱39,600
3️⃣ Apply Pro-Rated Interest (if applicable)
If your loan is approved mid-month (e.g., March 20), SSS charges interest for:
- March 20–31
- The full month of April
This is called pro-rated interest, meant to cover the time before your first amortization starts (usually two months after approval).
Typical pro-rated interest: ₱120–₱200 depending on timing.
4️⃣ Compute the Monthly Amortization
Monthly amortization is based on the remaining balance after each month (diminishing balance method).
Formula:
Monthly Interest = Outstanding Balance × (8% ÷ 12)
Monthly Amortization = (Principal ÷ Term) + Monthly Interest
5️⃣ Apply Deductions and Get Your Net Loan Proceeds
Net proceeds = Approved amount – (Service charge + Pro-rated interest)
📊 SSS Salary Loan Computation Example (2025)
Let’s say you apply for a ₱40,000 2-year loan.
| Item | Calculation | Result |
|---|---|---|
| Loan Amount | — | ₱40,000 |
| Service Charge | ₱40,000 × 0.01 | ₱400 |
| Pro-Rated Interest | Approx. | ₱160 |
| Net Proceeds | ₱40,000 − ₱560 | ₱39,440 |
| Monthly Interest | 8% ÷ 12 | 0.67% |
| Monthly Amortization | ₱1,816 (approx.) | — |
| Total Payment (24 months) | ₱43,584 | — |
So even though you borrow ₱40,000, you’ll receive around ₱39,440, and repay about ₱43,584 in total — including interest.
🧭 SSS Salary Loan Calculator (For Quick Computation)
If you want to see your exact monthly amortization and total payment, try this online tool:
Just enter your:
- Desired loan amount
- Loan term (1-year or 2-year)
- Approval date
It automatically computes your net proceeds, monthly dues, total repayment, and interest cost — using the official SSS rules.
💡 Pro tip: Compare the 1-year and 2-year options side-by-side to see which fits your budget better.
🧍♀️ Who Can Apply for the SSS Salary Loan?
You’re eligible if you meet these SSS conditions:
| Requirement | Details |
|---|---|
| Membership Status | Active (employed, self-employed, voluntary, or OFW) |
| Contributions | 36 for 1-year loan, 72 for 2-year loan |
| Recent Contributions | At least 6 within the last 12 months |
| Employer Status | Updated remittances (for employed) |
| Loan History | No existing unpaid or delinquent loans |
| My.SSS Account | Registered and active |
📆 Loan Repayment and Due Dates
- For employed members: Salary deduction every month; employer remits to SSS.
- For self-employed/voluntary: Pay via SSS app, GCash, Maya, or partner banks.
- First amortization: Due on or before the last day of the month following the 2nd month after loan approval.
Example: Loan approved March → first payment due May 31.
Late payments incur 1% monthly penalty on the unpaid amortization.
🔁 Loan Renewal Computation
You can renew your SSS Salary Loan after paying at least 50% of the principal and once 12 months have passed.
When you renew:
- Your new loan = new approved amount − old balance
- The term resets (12 or 24 months)
- Old interest is settled through the new disbursement
Example:
Old loan balance = ₱10,000
New approved loan = ₱40,000
Net loan = ₱40,000 − ₱10,000 = ₱30,000
🚨 Common Computation Mistakes to Avoid
- Ignoring the 1% service charge. Always subtract it from your expected proceeds.
- Forgetting pro-rated interest. It slightly reduces your net take-home.
- Confusing AMSC with actual salary. SSS uses salary credit brackets, not your exact pay.
- Thinking “8% interest” means flat rate. It’s computed monthly on a diminishing balance.
- Not checking contribution gaps. Missing months can lower your loanable amount.
📘 How to Double-Check Your Own Salary Loan Computation
You can easily verify your expected figures using this checklist:
- Check your 12-month salary credit average in My.SSS.
- Apply the 1% service charge deduction.
- Add pro-rated interest if applicable.
- Multiply 8% ÷ 12 for monthly interest rate.
- Estimate your monthly amortization.
- Confirm results using the SSS Salary Loan Calculator to verify accuracy.
🧮 Quick Comparison: 1-Year vs. 2-Year Loan
| Feature | 1-Year Loan | 2-Year Loan |
|---|---|---|
| Required Contributions | 36 | 72 |
| Max Loan Amount | ₱25,000 | ₱50,000 |
| Term | 12 months | 24 months |
| Monthly Amortization | Higher | Lower |
| Total Interest | Less overall | Slightly higher total |
| Best For | Short-term needs | Long-term flexibility |
🧩 Example Scenarios
Example A: ₱20,000 1-Year Loan
| Detail | Computation | Result |
|---|---|---|
| Service Charge | ₱20,000 × 1% | ₱200 |
| Net Proceeds | ₱19,800 | — |
| Monthly Amortization | ₱1,742 | — |
| Total Payment | ₱20,904 | — |
| Total Interest | ₱904 | — |
Example B: ₱40,000 2-Year Loan
| Detail | Computation | Result |
|---|---|---|
| Service Charge | ₱40,000 × 1% | ₱400 |
| Net Proceeds | ₱39,600 | — |
| Monthly Amortization | ₱1,816 | — |
| Total Payment | ₱43,584 | — |
| Total Interest | ₱3,584 | — |
These examples show how interest builds over time and why longer terms mean more total interest but smaller monthly dues.
💡 TL;DR Summary
- The SSS Salary Loan is computed using your average monthly salary credit and 8% annual interest.
- A 1% service charge and pro-rated interest are deducted upfront.
- Choose between 12-month or 24-month repayment.
- Use the SSS Salary Loan Calculator to know your exact figures.
- Paying early saves you money — no penalty for advance settlement.
❓ Frequently Asked Questions (FAQs)
1. How is SSS salary loan interest computed?
It’s 8% per year on the remaining balance (diminishing). Each month, interest is applied to the unpaid amount.
2. Why is my received amount lower than approved?
Because of 1% service charge and pro-rated interest deductions.
3. Can I fully pay early to save interest?
Yes. No penalty for early payment. It even reduces your total cost.
4. How do I check my remaining balance?
Log in to My.SSS, go to Inquiry → Loans → Salary Loan Info to see your remaining principal and interest.
5. What happens if I miss a payment?
SSS adds a 1% penalty per month on the unpaid amortization until you catch up.
🏁 Final Thoughts
Understanding your SSS Salary Loan computation helps you make smarter financial decisions.
Instead of guessing your monthly dues, you can confidently plan ahead, budget properly, and avoid unnecessary penalties.
Before you file your next loan, try the 👉 SSS Salary Loan Calculator to see your real numbers — instantly and accurately.
