The funding architecture for the Student Loan Trust Fund (SLTF) has not been reviewed since the government decided to introduce a guarantor-free system of applying for the fund, the Executive Director of Africa Education Watch, Kofi Asare, has revealed.
In 2022, the Vice President, Dr Mahamudu Bawumia, launched the ‘no-guarantor’ system, which allowed applicants to apply for a loan without having a guarantor. Previously, a guarantor must contribute to SSNIT before they can guarantee any applicant.
Meanwhile, the only source of funding for the SLTF, according to Kofi Asare, which accounts for about 65 percent, comes from recoveries of previous loans.
Speaking on TV3’s Ghana Tonight programme on Monday, February 19, the education advocate bemoaned the lack of multiple funds to sustain the scheme going forward.
Acknowledging the introduction of the no-guarantor policy, he said, “A guarantor-free student loan scheme was introduced about a year and a half ago for Ghanaian students to be able to access the loan using their Ghana card, which is great.”
The government intended to expand the coverage of beneficiaries of the student loan at the tertiary level.
“The whole idea is to expand access to the loan so the poor or needy students who require funding to access tertiary [education] will not be constrained by virtue of the fact that a relative might not be a SSNIT contributor.
“Unfortunately, we have not been able to provide adequate funds to support the increasing demand for the student loan,” he stated.
Mr Asare further revealed that only about 18,000 out of over 32,000 applicants in 2023 received approval and could have access to the loan. He added that “even for the 18,000, they only received one semester’s tranche.”
He also lamented that the student loan has always been in arrears.
“So it tells us that the figures and the financial architecture funding the student loan scheme weren’t reviewed when the free policy was introduced,” he said.
About SLTF
The Students Loan Trust Fund was established in December 2005 under the Trustee Incorporation Act 1962, Act 106.
The objectives of the Trust Fund are to provide financial resources for the sound management of the Trust for the benefit of students and to help promote and facilitate the national ideals enshrined in Articles 25 and 38 of the 1992 Constitution.
The Students Loans Trust Fund is governed by a Board of Trustees that comprises distinguished individuals of relevant backgrounds relevant to the business of SLTF.