The Student Loan Fund reported fewer borrowers repaying their debts in the past three months as they await the amended version of the law regarding reduced interest rates and default fines.
According to fund manager Chainarong Katchapanan, borrowers have paid directly to the fund 2.07 billion baht from September 15 to November 30, a 28% decrease year-on-year. Total debt repayment by debtors declined by 12% from the same period of the previous year. The decrease in numbers is due to borrowers waiting for clarification on an amendment to the Student Loan Fund Act, which was passed by the House of Representatives in September.
The House passed an amendment bill that would exempt fund debtors from interest, default fines, and guarantor requirements. However, when it reached the Senate, lawmakers altered it so that the fund charges a maximum interest rate of 1% per year and a maximum monthly fine of 0.5% for overdue payments. The Senate is scheduled to present its revised version to the House for consideration in the third reading session.
The current law sets the maximum interest rate for student loans at 7.5% per year, and the fund usually charges around 1% to minimize the financial effect on borrowers.
Chainarong further states that the fund currently has no liquidity issues and that it extends loans of around 40 billion baht every year. Currently, the fund has granted 697 billion baht to over 6.2 million students, with outstanding debt totaling 338 billion baht. (NNT)
 |
 |
 |
