The Government Service Insurance System said Tuesday it is studying a Philippine Stock Exchange (PSE) proposal to allow state-run pension funds to revive loans for stocks and other financial products through a phased pilot program designed to protect its members.
GSIS president and general-manager Jose Arnulfo Veloso said the agency recognizes the potential of these programs to expand retirement investment opportunities and strengthen the Philippine stock market.
Veloso said the initiative comes at a time when markets require institutional support and members deserve broader options for retirement.
The pension fund is proposing a framework centered on the accreditation of licensed stockbrokers rather than an immediate large-scale launch.
Under this model, brokers would assess member suitability, evaluate risk appetite, provide investment advice and execute transactions.
Veloso said while pension funds manage pooled investments and benefits, brokers are better equipped to manage individual client accounts and capital market transactions.
He said accrediting qualified professionals allows the agency to focus on governance and oversight while members receive expert guidance.
The framework will establish accreditation standards requiring proper licensing and a proven track record of compliance with Securities and Exchange Commission regulations.
It also sets eligibility rules and loan limits based on salary, length of service and existing retirement savings to ensure members do not borrow more than they can safely manage.
Mandatory disclosures will be required to ensure members understand that financial product prices fluctuate and borrowed funds could be impacted by market volatility.
The initiative also aims to create pathways for integration with the Personal Equity and Retirement Account and other tax-advantaged programs under Republic Act 9505.
The agency said any program should balance market development with the responsibility to protect its more than 2,500,000 members and pensioners.
Veloso said the agency is not opposed to innovation but is insisting on precision to build evidence and refine protections through pilot testing.
The GSIS plans to collaborate with the PSE and market regulators to develop the program elements before presenting a formal proposal to its board of trustees for approval.
