Understanding Pag-IBIG Contributions: Empowering Filipino Employees for a Secure Future

In the Philippines, the Pag-IBIG Fund plays a crucial role in providing financial security and assistance to Filipino workers. Established to address the housing needs of employees, Pag-IBIG (Pagtutulungan sa Kinabukasan: Ikaw, Bangko, Industriya at Gobyerno) has expanded its scope to include various benefits such as savings, loans, and retirement assistance. At the heart of Pag-IBIG's operations are the contributions made by employees, which serve as the lifeblood of the fund, ensuring its sustainability and effectiveness in serving its members.

What are Pag-IBIG Contributions?

Pag-IBIG contributions are mandatory savings deducted from the monthly salaries of Filipino employees and matched by their employers. These contributions are deposited into individual savings accounts under the member's name with the Pag-IBIG Fund. The amount contributed is based on the member's monthly compensation and follows a set schedule of contributions determined by Pag-IBIG. According to the employees, the increase of PHP100 may go unnoticed by you.

Importance of Pag-IBIG Contributions

  1. Housing Opportunities: 
  2. One of the primary benefits of Pag-IBIG contributions is access to housing loans. Members who have made sufficient contributions can apply for housing loans to purchase residential properties, construct or improve existing homes, or refinance existing mortgages. These loans often come with favourable terms, including low-interest rates and extended repayment periods, making homeownership more attainable for Filipino workers.

  3. Retirement Savings and Investments:
  4. Pag-IBIG contributions serve as a form of forced savings, encouraging individuals to build a financial safety net for themselves and their families. The funds accumulated through contributions can be withdrawn by members upon retirement, providing them with a source of income during their senior years. Additionally, Pag-IBIG savings earn dividends, allowing members to earn passive income on their investments over time.

  5. Emergency and Multi-Purpose Loans: 
  6. In addition to housing loans, Pag-IBIG offers emergency and multi-purpose loans to its members. These loans can be used to cover various expenses, including medical emergencies, education costs, home repairs, or even starting a small business. By maintaining regular contributions, employees ensure their eligibility for these loan facilities, providing them with financial assistance during times of need.

Contribution Rates and Payment

The contribution rate for Pag-IBIG contributions is currently set at a fixed percentage of the member's monthly compensation, with a cap on the maximum monthly contribution. Employers are responsible for deducting the employee's share from their salary and remitting both the employee and employer contributions to Pag-IBIG monthly. Self-employed individuals and voluntary members are also allowed to contribute to Pag-IBIG voluntarily, subject to the official contribution rates and guidelines.

Managing Pag-IBIG Contributions

To ensure transparency and accountability, Pag-IBIG provides its members with access to their individual savings accounts through various channels, including online portals and the virtual Pag-IBIG mobile app. Members can monitor their contributions, track their savings, and apply for loans or withdrawals conveniently. Additionally, Pag-IBIG conducts regular updates and outreach programs to educate members about their rights, benefits, and responsibilities regarding their contributions.

With Susan.one Payroll, employers can easily calculate their contributions automatically whilst running payroll.


Pag-IBIG contributions play a vital role in empowering Filipino employees to secure their financial futures and achieve their housing aspirations. By diligently contributing to the fund, employees gain access to housing loans and build savings, investments, and emergency resources to weather life's uncertainties. As a cornerstone of social security in the Philippines, Pag-IBIG embodies the collective commitment to providing a better quality of life for all Filipinos, ensuring no worker is left behind in their journey towards financial stability and prosperity.