Vice President Dr. Mahamudu Bawumia says government will waive the requirement of a guarantor as a prerequisite to accessing student loans starting next year, should the incumbent win the upcoming December 7th presidential elections.
Dr. Bawumia presenting the key highlights of the governing New Patriotic Party’s manifesto for the upcoming elections said all that will be required to access support from the Student Loan Trust Fund (SLTF) will be the National ID Card.
“One of the problems for students in getting enrollment and access is affordability–whether it is the enrollment into the public or private universities. So, we have a major promise – a policy initiative which we say, all tertiary students except teacher and nurse trainees who will be on the allowance, will now be able to get the option to obtain a student loan without the requirement of the guarantor.
“So, you don’t need a guarantor and all you need is your national ID card. That’s all and then you will be able to access your loan and once you complete your education, repayment will be deferred after your tertiary education, you’ll get a one-year grace period after your national service, then you start paying,” Dr. Bawumia explained at the launch of the NPP’s manifesto in Cape Coast, Central Region.
Currently, SLTF mandates applicants to provide one guarantor to qualify for the loan.
Previously, under the Social Security and National Insurance Trust (SSNIT) Students Loan Scheme, each borrower was required to provide three guarantors who needed to be contributors to the SSNIT Pension Scheme.
A guarantor is a person or agency that gives an assurance that a loan will be paid. The guarantor agrees to pay someone else’s outstanding debt in the event of default.
Many students, particularly the needy, found it difficult to get three guarantors to stand surety for the loans they were to contract for their tertiary education.
Thus, when the SLTF took over the management of students’ loans, one of the first things it did was to reduce the guarantor requirements to one. But the problem of getting even one guarantor still persists.
Therefore, the SLTF in its bid to resolve the issue adopted a diversified guarantor system, where, in addition to the SSNIT pension contributor, a corporate body, nationally-recognised religious body as well as Metropolitan, Municipal and District Assembly (MMDAs) can guarantee a loan application for a student who wishes to access a loan facility from the Fund.