THE CHALLENGE many Barbadians face in financing tertiary education brings into sharp focus the important role of the Student Revolving Loan Fund.
The way it has been treated by many beneficiaries – as a social welfare agency with disregard for repayments – can no longer be tolerated. There must be redress of this situation if others are to continuing benefiting.
The fund has long had a problem with delinquency, despite the pleas to pay up. The situation has got out of hand, with many borrowers disregarding the entreaties to honour their commitments.
We are clearly at a difficult stage. The state can no longer fund the scheme to meet expected demands at a time when there is a growing desire to pursue tertiary education. As the fund is not being replenished to the extent that it should be, an increasing number of would-be applicants are being frustrated.
This situation has been allowed to get out of hand, with neither borrowers nor guarantors concerned about the consequences of defaulting. In the past, management of the fund simply had not been relentless enough in the pursuit of debtors, even with the generous amnesties and refinancing offers offered.
The reality is that the Student Revolving Loan Scheme, apart from giving access to education loans, allows recipients to gain from life-changing opportunities. The return on investment for a university degree or professional programme is excellent. It really does not matter if the area of study is in humanities, social sciences or science and technology. The reality is that a graduate stands to earn much more than a non-graduate, except in a few very special cases.
On completion of their studies, graduates, including those who borrow from the student loan scheme, will buy vehicles often more expensive than the loan for their education. A vehicle for $100 000 or more will last perhaps eight years as opposed to an education for a lifetime. The vehicles seldom add to the owners’ earning potential, but the loans for them will be paid off in five to seven years. While a few graduates will end up with low paying jobs and find themselves in tight debt situations, the reality is that this will be so for only a minority.
Our social welfare system practised and encouraged by consecutive administrations has engendered a sense of entitlement. This is no longer sustainable and non-payment of student loans must not be allowed. All legal means must be pursued to recoup repayments.