…Gov’t introduces new requirements for UG students

By Svetlana Marshall
IN RESPONSE to the more than $8B owed to the University of Guyana Student Loan Agency, the Finance Ministry has strengthened the system with the primary objective of increasing the repayment rate.During a visit to the Student Loan Agency at the Turkeyen Campus on Monday, Guyana Chronicle, upon request, was presented with a copy of the application form which included a long list of requirements for both the borrower and their guarantor.

According to that list, first time loan applicants are not only required to submit the traditional information such as Letter of Acceptance, Student Registration Invoice, Birth Certificate and proof of address, but their Guyana Passport, Bank Standing Order and Job Letter.

Like the applicants, guarantors are mandated to provide the agency with evidence of employment, their passport, TIN Certificate and a Liability Statement and or Credit Reports from the Credit Bureau.

For some students, the requirements are too much to ask for. Sabita Stephenson – a Third Year Environmental Science student said she is frustrated with the process. “I think, it is a bit too much,” Stephenson told Guyana Chronicle while on Campus on Monday.

She opined that while some applicants may be willing to provide the required documents, the guarantors may find it difficult. “It is ridiculous, it is too much, it is just too much…Some of the guarantors ain’t able with the run around, so many of them don’t want to do it anymore,” she posited.

Her colleague Athena Lytle echoed similar sentiments while questioning the need to have guarantors provide their passport information, TIN Certificate and Liability Statement. “It is too much to ask for, they are asking for so much information, some of them are irrelevant,” Lytle contended.

However, second year Computer Science student Noel Lord, begged to differ. According to Lord, the new requirements will keep beneficiaries of the loans in check. “I don’t mind because I do have to pay it back, it is more secure this way… I think it is reasonable,” he said.

Too harsh
A leading Private Sector official told Guyana Chronicle that the measures are too harsh, noting too that the agency should not lose sight of its primary function, which is to assist persons who are unable to pay for their tertiary education. “I don’t want to say that it is draconian but it is a little too much,” the official who asked not to be named said.

While acknowledging that the agency in the past was mismanaged, resulting in a poor repayment rate, the official said that the new measures or requirements may result in many students being unable to attend the university. “Oh gosh this is not a business loan you are applying for, this is a student loan. I don’t think guarantors would want to follow up with such a procedure,” the official said.

At the commercial banks, applicants, the official pointed out, are asked to complete a credit evaluation form, which addresses four key things: one’s earning, assets, expenses and ability to repay the bank. “The agency must not forget its social responsibility,” the official reiterated.

The student loan agency, which is responsible for managing a revolving fund, has made available to students approximately 26,239 loans amounting to $9.5B to assist students in paying their tuition fees; but as of May 2016, statistics show, repayment had amounted to only $1.75B, with installments due amounting to $5.7B. Head of the Student Loan Agency, Rawle Sue-Ho had told reporters that June and July have yielded much repayment since the agency began its public awareness campaign. He said there has been a spike in the repayment of loans.

“In June, we had over 100 per cent increase from the previous months’ collections… Students have been coming in to make payments on old loans, with some paying off… There was a continuation of the trend in July,” he said.

A recently conducted forensic audit of the agency revealed that from 1994 to May 2015, some 17,567 or 69.4 per cent of borrowers were deemed delinquent.