Illustrative photo (Photo: The courtesy of the SLF)Bangkok (VNA) – The Thai government has been rollingout measures to solve the debt problem of the Student Loan Fund (SLF),including reducing the interest rate and the fine for defaulting to help 3.5million borrowers pay back their loans, spokesperson of the government ChaiWacharonke said on March 30.
The SLF is a government programme that provides loans tostudents who cannot afford to pay for their education. The loans are typicallyrepaid over 15 years.
Chai said the SLF now has over 3.5 million active borrowers whoowe some 454.64 billion baht (12.4 billion USD). The fund also has over 5.3million past borrowers who have yet to close their accounts – around 49% ofthis group were already defaulters facing legal action.
He said the SLF’s debt problem is due to several factors,including the economic downturn, the rising cost of living, and the difficultyin finding a job after graduation.
Prime Minister Srettha Thavisin has tasked related agencieswith finding measures to help borrowers pay back as much as possible, saidChai.
A special governmental committee responsible for tackling debtproblems of the general public approved the move to let the SLF cap theinterest rate at 1% annually and limit the fine for default to 0.5% annually tomake it easier for borrowers to settle their debt.
Chai said the SLF has also adjusted its repayment calculationmodel to prioritise capital before interest. This results in lower overallinterest and therefore allows more borrowers to close their accountsimmediately, while those who had already paid interest before the adjustmentwill be granted a refund.
The committee also ordered the SLF to remove loan guarantorrequirements from 2022 to facilitate loan applications by new borrowers andminimise legal complications and expenses in case of repayment default, Chaiadded.
The SLF on February 15 deployed a debtrestructuring programme for borrowers who have difficulty repaying theirdebts./.
