The government needs 189 million GHC next year to provide student loans

General News of Monday, June 10, 2019

Source: Graphic.com.gh

2019-06-10

The Student Loan Trust Fund (SLTF) provides that the granting of loans to nearly 50,000 college students likely to apply for a loan during the academic year 2020 / 2021 will cost the government at least 189 million GH ¢.

The estimated student population represents 10% of the annual enrollment in higher education, which is expected to reach 145,000 students during the 2020/2021 academic year.

SLTF Executive Director, Nana Kwaku Agyei Yeboah, said the fund expects a huge increase in the number of requests for financial badistance when the first batch of free SHS students will graduate in 2020.

According to his predictions, if the number of students increased by 15%, 284 million GH ¢ would be needed, and if it reached 20%, the budget would be 378 million GH ¢.

Currently, 27,000 students in training benefit from this loan.

As it stands, the SLTF needs $ 80 million a year to meet its obligations to students.

"The objective of the SLTF is to provide financial badistance to all Ghanaians pursuing accredited programs in licensed tertiary institutions.

"With the successful implementation of the free SHS program, we expect an avalanche of applications from students who would not normally qualify for higher education. It will be a tsunami, but the government is determined that funding will not be an obstacle for citizens who are willing and able to pursue higher education, "Nana Yeboah told student leaders who had paid a courtesy visit to her office. d & # 39; Accra. .

Delegation

The delegation was led by executives from the Council of Student Representatives (CLC) of the Ghana Journalism Institute, the African University College of Communication, the University of Wisconsin, NAFTI, the Business School of Accra and the University of Accra Professional Studies.

Judge Aboagye Sarpong, head of the delegation, explained that the visit provided a better understanding of the difficulties faced by fund managers, which resulted in a delay in the disbursement of student loans for the second half of 2018/19. academic year.

Restructuring

Nana Yeboah told the students that the SLTF was being restructured due to increased demand from beneficiaries.

He said the fund would come out stronger processes, with increased and sustainable funding, as well as introducing different products to meet the varied needs of students.

"We are at a painful stage, but they are necessary pains for us to grow up," he said.

The CEO thanked the SRC leaders for their collaboration over the years and pledged to repay all outstanding loans as soon as possible.

As part of efforts to increase funding, Mr. George Laing, SLTF Senior Communications Officer, said his unit had a technical resource mobilization unit that was considering a partnership with the SLTF. some companies that manage scholarship schemes.

In this regard, he said, the fund could implement the corporate social responsibility programs of these enterprises related to higher education.

He cited a collaboration between the Databank Foundation and the SLTF which, in February of this year, announced that 20 SHS students would benefit from a scholarship program from the databank for the year academic year 2019-2020.

The program, which is now open to public submissions, will benefit students from disadvantaged communities in the five northern regions who will be admitted to accredited higher education institutions to pursue accredited programs but will not be able to increase tuition fees. Initial admission required for the safety of their students. places.

challenges

In recent years, the SLTF faced some challenges as a 50% increase in the loan amount led to an increase in the number of applications, which weighed on the fund.

In November of last year, more than 32,000 registered students who applied for a loan for the 2018/2019 academic year had still not received their money, three months into the beginning of the year. ;college year.

The students were paid in December, at the end of the first semester.

The SLTF increased the loan amount to a minimum of GHG 2,000 and a maximum of GH ¢ 3,000 as of the 2018/2019 academic year.

In 2016, the minimum amount increased from 650 to 1,000 GH ¢ and the maximum from 1,600 to 2,000 GH.

The loan is intended to cover personal expenses, including board costs, accommodation, books and materials, and for other purposes that may be necessary.

The amount has been adjusted to cope with the increased fees imposed by higher education institutions.

Recovery

Since students do not repay loans as soon as they graduate, the recovery has become a major puzzle for the fund.

Students receive a grace period of at least one year after leaving school, but some recipients may take more than a year to repay their loan.

By September 2017, the trust had recovered at least 60% of student loans.

In June 2016, it published the names of 31,223 people who had collected loans amounting to 78 million GH ¢ and which had defaulted.

Some of the people whose names have been posted on the SLTF website have been in default for almost 10 years.

Currently, trust threatens to publish these names in national dailies if the defaulters fail or refuse to make payments.