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New measures, including being barred from leaving Guyana, announced to rake in GYD$ Billions in outstanding student loans

Finance Minister, Winston Jordan cutting the ribbon to officially open the new office of the Ministry of Finance's Student Loan Agency.

Finance Minister, Winston Jordan cutting the ribbon to officially open the new office of the Ministry of Finance’s Student Loan Agency.

Graduates and students of the University of Guyana (UG), who fail to repay tuition fees, will soon be barred from leaving the country, Finance Minister, Winston Jordan announced Friday.

“All information on recalcitrant borrowers will be eventually put at all immigration points and we will also set up a desk at the same time for those who will be stopped from travelling to make the necessary arrangements for payment of the loan or the debt prior to departure,” he said.

He explained that although the stamping of passports of UG student loan debtors was not proposed to or discussed by Cabinet, agreement was reached to post the database of debtors at all immigration ports of entry and exit.

Speaking at the opening of the Finance Ministry’s new Student Loans Office at UG’s Turkeyen Campus, Jordan also announced interest reduction packages for those who make arrangements to repay their loans by August and September, 2016. In keeping with a wide-ranging audit report into the operations of the Student Loan Agency, the “Jubilee offer” will be a 75 percent reduction in the accumulated arrears of interest if borrowers pay their indebtedness no later than August 31, 2016 or a 50 percent reduction in accumulated arrears of interest if borrowers bring their accounts up to date by September 30, 2016.

“If, however, a borrower defaults subsequently interest so waived will be restored to the borrower’s account,” he said.

The Finance Minister also announced that before guarantors endorse student loan applications, credit reports on them would be pulled from the credit bureau, CreditInfo. “Once we get the database intact, this database will be uploaded to the credit bureau and students will be required to pull a credit report prior to receiving a loan,” he added.

Jordan further announced that loans would be given only to Guyanese students residing in Guyana for 180 days continuously during a calendar year and they must be holders of valid Guyana passports.

Borrowers, who switch from one programme to another, would first have to pay off the full sum of all outstanding loans before accessing a new loan. Letters of notification will be sent to borrowers one month after the loan is issued. “In the event of a failure to respond positively by borrowers  after a reasonable period has elapsed following a demand for payment, the government will exercise all options to recoup the debt including litigation,” he said. Jordan said if the students cannot  be located the notifications would be sent to their guarantors.

He said that guarantors would now have to provide liability statements and/ or credit reports from the Credit Bureau. Students would be required to commence repayment on or before tyhe one-year grace period once they have secured employment.

Since the inception of the Student Loan Agency in 1994, at least GYD$9.5 billion made available to the revolving agency to facilitate the payment of tuition fees.

Up to May, 2016 figures show that 26,239 loans have been issued but  repayment up the same period amounted to GYD$1.75 billion, with installments due amounting to GYD$5.7 billion.

The new Student Loan Agency was built at a cost of GYD$26.5 million- the Finance Minister said “taxpayers’ money well spent.”

  • M Nicols

    ‘New measures, including being barred from leaving Guyana, announced to rake in GYD$ Billions in outstanding student loans’
    Have you notice that universal smile in that entire photo?
    The students may already be working out a master plan to wipe that smile off in a few years time.

    • Lancelot Brassington

      Are they not supposed to repay the loan?

      • M Nicols

        But Guyana develop that culture of ‘debt write-off’ that they expect free-ness and a ‘loan write-off’ in due course of time.
        Therefore, a college loan is just that as far as they are concern.

  • Hon Alex Fraser

    Wow, Ok so you want people to repay the money but cant find jobs for them. Where do you think they will get the money from if they cant get work?

    • rs dasai

      No GVt has jobs for all. Private enterprise provides more jobs and should fund some of the tuition etc. Yes?

  • Reason

    Fair system. Even UG, like everything else in the country, has to be remedied. How can a university survive with more than 70% of loans in default?

    God bless APNU-AFC

    • M Nicols

      ‘Free education from cradle to grave’
      Who and which Party excite the country with a above statement and became most popular among his flock?

  • rudeo

    Who can quarrel here and over what?

  • Lancelot Brassington

    Be constructive madam. Write something of logic and substance.

  • Donald

    Any form of reduction will be given to the honest set of students who are trying to repay?
    Why provide reduction for the set who seems dishonest?

  • ChosenNChrist

    This is obviously too much. We learnt of the findings of the audit about one to two months ago. Weekly, we are learning of the attempts to put all these drastic measures in place. What about the findings of the other audits?

    🙁 This group of leaders like prying on the vulnerable: the old and the young. Or perhaps there is a hidden agenda to catch “someone(s)”. Unfortunately, these tactics will further depress, progressive youths, who have not yet attained the amount to repay their student loan.

    What about the negotiations with the unions for salary increases?

    What about employment opportunities for the youth?

    When will teachers be able to earn more than all public servants? Because without them, many would have been less fortunate.

    What about the vendors?

    What about the COI into the death of the two boys at the Drop-in Centre. Yes. I know, I read, the report will be out August 15, but what was done for the parents of these children after the preliminary report was out? Certainly, there is need for corrections at the Centre.

    There is an extensive blurring of the vision of our leaders. They need to take a look at their manifesto and begin to fulfill those promises.