Loans are provided in accordance with the Incorporation, Activities and Functioning of the Funds for Occupational Retirement Provision Law with No. 146(I)/06, put into force on the 17/11/06 and the Section 32(6)(b) for the following cases:
I. To cover educational expenses of the children of the member or the member itself.
II. To cover health expenses of the member or his/her dependents.
III. To obtain, repair or complete a private house for himself or a child of his/hers or to pay a mortgage loan, provided that the mortgage loan has been taken in order to obtain, repair or complete the housing of the member or a child of his/hers.
- In order to obtain a loan, a member shall have to file an application in which to state the sum requested, the purpose for the loan, the period of repayment and the mode of payment.
- Provided that the Administrative Committee shall regulate such cases in accordance with special regulations and terms determined by it for this purpose.
- The Administrative Committee shall be obliged to ask for any sufficient and convincing documentation it may deem fit for all the above cases of advancing a loan.
- The Administrative Committee shall decide the loan amount to be advanced in the above cases, but in no case shall the amount exceed 75% of the sum which the member would be entitled to if he/she left his/her employment voluntarily.
- Every loan advanced shall be debited to the member’s personal account and credited with every monthly payment installment.
- The Administrative Committee shall determine the monthly or other installments for the repayment of the loan in proportion to the amount of the loan. Provided that in determining the mode of loan repayment a provision shall be made enabling a member to repay the loan before retirement and during a period not exceeding twenty years, in accordance with the judgment of the Administrative Committee.
- The Administrative Committee shall also determine the interest on the loan, which should exceed the basic interest of the Central Bank of Cyprus by at least 1%.
A member cannot apply for a second loan unless he/she has duly repaid any previous loan.