Presidential Decree No. 932




M a n i l a

PRESIDENTIAL DECREE No. 932 May 13, 1976


WHEREAS, it is of common knowledge that many deserving students are unable to pursue their studies due to financial difficulties;

WHEREAS, is a declared national policy to democratize access to education by providing opportunities to deserving citizens to pursue higher education and training in the fields of study vital to the development of the national economy;

WHEREAS, the limited scope and coverage of existing state scholarship programs should be supplemented by schemes whereby the state can expand its commitment of financial assistance to deserving students;

WHEREAS, the establishment of an educational assistance program more commonly known as the "study now pay later plan" has been enunciated as a major measure to promote such democratization of educational opportunities.

NOW, THEREFORE, I, FERDINAND E. MARCOS, President of the Republic of the Philippines, by virtue of the powers vested in me by the Constitution, hereby order and decree the following to be part of the law of the land:

Section 1. This decree shall hereinafter be referred to as the "Educational Assistance Act of 1976".

Sec. 2. Under such guidelines issued by the Educational Assistance Policy Council hereinafter created, poor but deserving students may avail of educational assistance from loanable funds as established below:

1. Educational Loan Funds (ELF)

(a) A loan fund initially constituted at fifty million (P50,000,000.00) pesos shall be earmarked, set up and administered independently at the SSS and GSIS which shall allocate twenty five million (P25,000,000.00) pesos each from their investible funds spread in a yearly contribution of five million (P5,000,000.00) pesos starting calendar year 1976-77. This fund shall be used to service the financial needs of eligible students regardless of whether or not their parents or any of them are members of the SSS and GSIS. The fund shall be in addition to the current educational loan program of the SSS and the scholarship program of the GSIS.

(b) The PNB, DBP and the Land Bank shall set aside five million (P5,000,000.00) pesos each of their annual investment portfolio for the purpose. These institutions shall submit to the Council the procedural guidelines for their participation taking into account their own charter objectives.

(c) All private banking institutions and Amanah Bank shall also earmark a certain percentage of their investible funds for the purpose.

(d) The amount of loan that may be granted each student shall be determined by the Council considering the number of years to complete his studies and the amount needed for such expenditures as tuition and other school fees, board and lodging, pocket money, books and supplies and other miscellaneous expenses.

(e) All loans under this schemes shall be covered by a guaranty funds which is hereby created, under such conditions as may be imposed by the Council.

2. Educational Loan Guarantee Funds (ELGF)

(a) The sum of one million (P1,000,000.00) pesos in hereby authorized to be appropriated out of any funds in the National Treasury not otherwise appropriated to constitute the initial Educational Loan Guarantee Fund. Earnings guarantee charges and other credits arising from the operations of this loan fund shall accrue to the Educational Guarantee Fund.

(b) The guarantee fund shall be administered by the Council.

Sec. 3. The Council may accept donations legacies, grants-in-aid and other contributions to form part of the loan and/or Guarantee Funds.

Sec. 4. The payment of all loans granted to any student-borrowers under the schemes enumerated shall be made immediately upon employment under such payroll checkoff-system as may be established by the Council.

Sec. 5. A policy making council to oversee this program is hereby created to be composed of the Secretary of Education and Culture as Chairman, the Secretary of Labor as Vice-Chairman, and the Director-General of the NEDA, Secretary of Finance, Secretary of Social Welfare, Budget Commissioner, Presidential Assistant on Youth and Sports Development, Governor of the Central Bank, Administrator of the SSS and General Manager of the GSIS or their alternatives as members.

It shall be the function of the Council to:

(a) Determine and issue the appropriate policies, measures, rules and regulations necessary to implement, maintain and enhance this program.

(b) Issue guidelines to govern existing and future educational assistance programs of other government agencies and the private sector.

(c) Enlist the cooperation of schools and other relevant institutions for the effective implementation and enhancement and enhancement of the program.

(d) Perform such other duties as hereinafter be assigned to it by the President of the Philippines.

Sec. 6. An inter-agency secretariat, the composition and function of which shall be determined by the Council, is hereafter created, to assist the Council in the implementation of this program.

The sum of two hundred thousand (P200,000.00) pesos is hereby appropriated annually to be included in the budget of the Department of Education and Culture to finance the operations of the secretariat.

Sec. 7. Qualification of Applicants.

Any Filipino citizen who graduates from a duly authorized secondary school, whether public and private, desiring to pursue further studies may avail of assistance under any of the schemes, the basic consideration being he is poor but deserving. The Council shall determine such other qualifications as it deems proper for the purpose.

Sec. 8. This Decree shall take effect immediately upon publication of its implementing rules and regulations in two (2) newspapers of general circulation in the Philippines.

Sec. 9. The Student Loan Authority created under RA 6014 is hereby abolished. Likewise, all acts or parts of acts inconsistent herewith are hereby repealed or modified accordingly.

Done in the City of Manila, this 13th day of May, in the year of Our Lord, nineteen hundred and seventy-six.



Pursuant to the provision of Sec. 8 of Presidential Decree 932 entitled the Educational Assistance Act of 1976, the following implementing rules and regulations are hereby promulgated for the guidance and information of all concerned:


Section 1.

(a) "Educational Loan Fund" refers to funds made available by lending institutions to service the financial needs of the eligible students.

(b) "Educational Loan Guarantee Fund" refers to the funds to be made available by the government for lending institutions to avail in case of defaults in payments of obligations.

(c) "Plan" refers to the Educational Assistance Act of 1976 or the "Study Now Pay Later Plan."

(d) "Council" refers to the Policy Making Council.

(e) "Secretariat" refers to the inter-agency body organized to assist the Council in the implementation of the Plan and serves as its implementing arm.

(f) "Priority Course" refers to any of the courses specified by the Council as necessary for national development.

(g) "Degree Programs" refer to college and university courses leading to at least a Bachelor's degree.

(h) "Non-degree Programs" refers to all post secondary vocational or technical courses, not otherwise covered by degree requirements.

(i) "School" refers to any government or duly recognized private college and university.

(j) "Grantee" refers to a student who has been granted an educational loan under this Plan.

(k) "Dependent" refers to the status of a loan applicant who is totally dependent on his/her parents or guardian for support.


Section 1. The Plan shall include in its coverage Filipino citizens desiring to pursue post secondary courses in schools in the Philippines, public or private, provided they possess the qualifications required under the provisions of this Decree and its implementing rules and regulations and Provided, further, that they enroll in priority courses specified by the Council.

Sec. 2. The Plan shall likewise include in its coverage students enrolled in priority courses in any curriculum years on the post secondary level.


Section 1. Educational loan funds to be made available under the Plan, pursuant to Sec. 21 of this Decree, shall be administered by the different participating funding institutions. Such institutions shall earmark a portion of their loanable funds every year for students entering degree or non-degree programs for the first time.

Sec. 2. To facilitate loan grants under this Plan, participating lending institutions shall, as soon as practicable, authorize their branch offices to extend loans according to the loan ceiling authority granted them under such guidelines as they may promulgate. Each funding agency shall issue its own procedural guidelines for its participation, including lending procedures, structuring of loan repayment, and interest rates. The Council shall in due time take toward the standardization of such operational procedures.

Sec. 3. The Educational Loan Guarantee Funds, as provided under Sec. 2.2 of this Decree including earnings of the funds, donations, legacies, grants-in and other contributions accepted by the Council which form part of the said fund, shall be administered by the Council under such rules and regulations as it may promulgate. No portion of the Fund shall be expended for administration purposes.


Section 1. Without prejudice to such exceptions as may be prescribed by the Council, an applicant for financial assistance under this Plan shall possess the following qualifications:

(a) He/She must be a Filipino citizen and a resident of the Philippines.

(b) He/She must be single and not over 25 years of age at the time of application.

(c) He/She is enrolling or is enrolled in any of the priority courses listed in Rule V hereof.

(d) He/She is in good health as shown by a medical certificate issued by a government physician.

(e) He/She must be of good moral character and has not been the subject of any disciplinary action.

(f) He/She is deserving.

i) For those entering the freshman year:

1. He/She must have completed his secondary course in a public school or in a duly recognized private school in the Philippines and must belong to the upper 25% of his/her graduating class.

2. In the case of applicant who will pursue a degree program, in addition, he/she must have qualified in the NCEE and obtained a score not lower than 50% percentile rank as shown in his NCEE rating.

ii) If already enrolled in a priority course:

1) He/She must not have failed in any subject as shown in his transcript of records in the semester immediately preceding the application for a loan and must have obtained a weighed average of at least 2.5 or its equivalent during said semester.

(g) He/She is poor:

1. He/She must be a dependent (son/daughter) of parents or guardians with a gross family income of not more than P12,000 per annum;

2. He/She has no other source of support than what his parents or guardian can provide;

3. He/She is not enjoying a governmental or private scholarship grant or receiving any grants-in-aid for his studies from any source.

Sec. 2. There shall be only one grantee per family in any given school year.


Section 1. The following are the priority courses in which loan applicants may enroll, subject to such changes or additions as the Council may determine from time to time:

a. Degree Programs

1. BS Agriculture, Major in : Agronomy, Plant Pathology; Animal Husbandry, Agricultural Economics, Agricultural Botany, Soils.

2. BS Agricultural/Business

3. BS Agricultural Engineering

4. BS Agricultural Chemistry

5. BS Agricultural Education

6. BS Agricultural Extension

7. BS Veterinary Medicine

8. BS Mining Engineering

9. BS Sanitary Engineering

10. BS Industrial Education

11. BS Geology

12. BS Industrial Chemistry

13. BS Fisheries, Major in: Fishing Technology, Inland Fisheries, Marine Fisheries.

14. BS Forestry, Major in: Forest Biological Sciences, Forest Resources Management, Forestry Extension, Wood Sciences and Technology.

15. BS Rural Sociology

16. BS Food Technology

17. BS Marine Biology

18. BS Sugar Technology

19. AB Economics

20. BS Chemical Engineering

21. BS Civil Engineering

22. BS Metallurgical Engineering

23. BS Electrical Engineering

24. BS Geodetical Engineering

25. BS Aeronautical Engineering

26. BS Electronics and Communications Engineering

27. BS Mechanical Engineering

28. BS Marine Transportation

29. BS Management Engineering

30. BS Industrial Technology

31. BS Management of Small Scale Industries

32. BS Chemistry

33. BS Physics

34. BS Mathematics

35. BS Statistics

36. BS Textile Technology

37. BS Rubber Technology

b. Non-Degree Programs

1. Wood Pattern Making

2. Auto Mechanics

3. Welding Technology

4. Electronics

5. Mechanics

6. Diesel Technology

7. Sheet Metal Technology

8. Automotive Technology

9. Industrial Technology

10. Key Punching

11. Machine Shop Technology

12. Radio/TV Technician

13. Radio Communication

14. Aircraft Technician


Section 1. Application for Loans under this Plan shall be prepared and submitted in three (3) copies on a standard form adopted by the Council and shall be filed not later than 15 days before the start of the enrolment period.

Sec. 2. Students enrolling in the freshman year shall file their application with the Office of the Schools Division Superintendent of the province or city of their residence.

In the case of those who are already pursuing degree or non-degree courses, applications may be filed with the Office of the Division Superintendent or the DEC Regional Office nearest the School the applicant is enrolled in.

Sec. 3. A loan application shall be accompanied by the following supporting documents:

A. 1. Names and ages of dependents.

2. The aggregate annual family income from all sources.

B. A medical certificate signed by a government physician certifying to the applicant's physical fitness to pursue his/her studies.

C. 1. If applicant is enrolling in degree program in the freshman year:

(a) A xerox copy of the NCEE report of rating.

(b) Certificate of the School Registrar or Principal certifying to his/her graduation from the secondary course and that he/she is among the top 20% of entire graduating class of the school.

2. If already pursuing a priority course, a xerox copy of rating obtained in the semester last enrolled in.

D. If applicant is enrolling in non-degree vocational/technical course:

1. A certificate signed by the Registrar or Principal certifying to grades obtained in all fourth year subjects, the general average and date of graduation, and further, that he belongs to the upper 25% of the entire graduating class.

E. A certificate signed by the secondary school head or Registrar that the applicant is of good moral character and that he/she has not been subject to any disciplinary action.

Sec. 4. For purposes of processing loan applications, a Processing Unit shall be organized in each Regional and Division Office. A ranking supervisor may be assigned to head this Unit. The Unit shall act on all applications submitted to it indicating in bold letters the action taken thereon: e.g. "APPROVED or "DISAPPROVED".

In case of approval, the original copy of the application and all supporting documents shall be returned to the applicant who shall then proceed in accordance with the provision specified in Sec. 5. The second copy shall be forwarded to the Office of the Secretary and the third copy retained for file in the Regional or Division Office, as the case may be.

In case of disapproval, the application and supporting documents shall be returned to the applicant. One copy of the applicant shall, however, be retained for file.

Sec. 5. After the application papers have been duly processed and approved, the applicant shall secure, as the last supporting document prior to submitting his papers to a lending institution, a certificate of admission to the priority course from the school he intends to enroll in.

Sec. 6. All Processing Units in the Regional or Division Offices, shall submit to the Office of the Secretary, DEC, within thirty (30) days after the opening of each school term, a report on applications processed, indicating: (1) names of applicants, (2) action taken and (3) the courses each intended to enroll in. This report shall be accompanied by the duplicate copies of all approved loan applications processed by the office.

Sec. 7. The Secretary of Education and Culture shall issue such directives as may be necessary for the information, guidance and compliance of all schools and offices concerned to insure the smooth and efficient implementation of the Plan.


Section 1. Loans that may be granted under the Plan shall be in accordance with the following schedule:

Items Maximum Amount Allowable per Annum
(2 Semesters)
I. School Expenses
a. Tuition and other fees P800.00
b. Books and other school supplies P500.00
TOTAL I P1,300.00
II. Living and Other Expenses;
a. Board and Lodging P2,500.00
b. Uniform and other Personal Expenses P200.00
TOTAL II P2,700.00

Sec. 2. A student borrower may avail of any of the following loan options:

Option A. A full loan to cover School Living and Other Expenses (I a & b; II a & b)

Option B. A loan for School Expenses only (I a & b)

Option C. A loan for living and other expenses only (II a & b)

Option D. A choice of any of the items in I and II of Section 1 (any of Ia, Ib, IIa, or IIb)

Sec. 3. Nothing in this Rule shall prevent a borrower from applying for an amount less than the maximum allowable for an item in the loan schedule. The lending institutions shall make adjustments on loans applied for as actual needs, and/or circumstances warrant.

Sec. 4. The lending institutions shall determine the manner and schedule of release of the loans: Provided, however, that the release of loan funds shall not make it difficult for the student to get enrolled, secure his school needs, or pay his obligations on time. The student borrower shall indicate in his original loan application the option and the amount he intends to undertake, without prejudice to making a change of option in succeeding curricular years of his studies, subject, however, to approval of such request by the lending institutions which granted the loan. Unless a request for change of option is made, it shall be assumed that the borrower continues to receive the proceeds of his loans as provided in the original loan agreement with the leading institution.


Section 1. Financial assistance to any grantee under the Plan shall continue to be provided until he/she shall have completed his course, subject to the following conditions:

(a) Each grantee shall enroll immediately in the semester following the approval of his/her loan.

(b) Except for extraordinary circumstances and the proper permission of the Secretariat, each grantee shall carry each semester the full loan prescribed by his course of study.

(c) Under no circumstances should a grantee drop a course which would result in underloading.

(d) He/She shall not transfer from one course to another except upon prior approval of the Council.

(e) If for a valid reason a grantee is unable to enroll for a period not exceeding one curricular year, his privilege to assistance shall be deferred until he resumes his studies.

Sec. 2. To qualify for continue or renewal of assistance, a grantee shall:

(a) Maintain a weighted average of at least "2.75" or its equivalent during the preceding academic year.

(b) Not get a grade of "5" or its equivalent in more than two subjects every academic year. However, a disqualified recipient who has failed to meet the grade requirement stated above, may be reinstated in the following semester if he obtains a general weighted average of at least 2.5 or its equivalent. Any grade of "4" or INC. or its equivalent must be removed/completed prior to the next registration period.

(c) Not have been subjected to disciplinary action involving more than one month suspension.

Sec. 3. Each loan applicant shall, prior to the grant of a loan sign a loan agreement on a form prescribed by the lending institution.

Sec. 4. Financial assistance to any grantee under this Plan shall be terminated in the event a grantee becomes an awardee of other government or private scholarships or grant, without prejudice to payments by said grantee of actual obligations incurred with the lending institution.


Section 1. The grantee shall pay the loan including accrued interest immediately upon employment following graduation under such terms and conditions as provided in his/her loan agreement with the lending institution. To insure regular payments on his/her loan a payroll check-off system shall be established by the Council.

Sec. 2. The grantee shall be liable for repayment of the loan granted him including accrued interest in case of non-completion of the course or non-employment after graduation, under such terms and conditions as agreed upon with the lending institution.


Section 1. All lending institutions participating under this Plan shall be covered by the Educational Guarantee Loan Fund.

Sec. 2. The Council, upon the recommendation of the Secretariat shall promulgate the guidelines on the availment by lending institutions of the Guarantee Loan Fund.


Section 1. There shall be an inter-agency Secretariat to assist the Policy Council in the implementation of the Plan. It shall serve as the implementing arm of the Council.

Sec. 2. It shall be composed of representative from the various agencies composing the Policy Council, a representative each of the participating lending institution, and such other members as the Council may determine. The nominations of such representatives who compose the Secretariat shall be subject to approval of the Council. The members shall elect a Chairman to preside over its meeting.

Sec. 3. These Secretariat shall meet regularly at least twice a month or as often as may be necessary upon the request of the Chairman of any three members thereof, or upon the call of the Council.

Sec. 4. The Secretariat shall be provided with staff support by the Department of Education and Culture. The administrative and operational expenses of the Secretariat shall be provided from the annual appropriation of the Department of Education and Culture, pursuant to the provisions of Sec. 6 of P.D. 932.


Section 1. The public employment offices of the Bureau of Employment Services of the Department of Labor shall extend all available assistance for job placement of graduated grantees. The employment offices of said Bureau shall likewise establish contact among working grantees to assist the funding institutions in the repayment of student loans.

Sec. 2. It shall be the function of the Secretariat to coordinate with all government agencies to monitor job openings and ensure placement of graduated grantees.

Sec. 3. Subject to the provisions of the existing law on recruitment and all other things being equal, the preference shall be accorded graduated grantees for employment in the government service.


Section 1. To enable grantees to enroll in the first semester of school year 1976-1977, the GSIS and SSS shall each make immediately available P5.0 M of their investible funds for lending to deserving applications. The other funding institutions covered under Sec. 2.1 (b) & (c) of this Decree shall likewise make available loan funds for school year 1976-1977 in such amounts as their respective Government Boards may determine: Provided, however, that by school year 1977-1978, all lending institutions shall make loan funds available in accordance with their commitments under this Decree.

Sec. 2. In view of the constraints of time in the implementation of the Plan, schools shall allow later enrolment of loan grantees for the first semester of school year 1976-1977, but in no case beyond June 30, 1976.


This Decree and its implementing rules and regulations shall take effect upon publication in two newspapers of general circulation in the Philippines.

ADOPTED by the Policy Council in this 4th day of June, 1976 in the City of Manila, Philippines.

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