President of the National Union of Ghana Students (NUGS), Dennis Appiah Larbi Ampofo, has expressed the need for a financially sustainable plan to be implemented by the Student Loans Trust Fund to ensure the timely disbursement of loans to students.

According to him, the no-guarantor policy initiated by government which takes out the initial requirement of a guarantor before students are granted loans cannot be blamed for the current delays in loan payments to students. He indicated that the delay being experienced is as a result of “funding gap”.

Mr Ampofo emphasized that the no-guarantor policy rather affords students who are not from financially buoyant families to promptly pay their fees.

“Mind you, applicants of the loan are usually from very low-income backgrounds where it is even difficult to find a public servant or even someone in the capacity to serve as a guarantor. We believe that the no-guarantor policy is good, the only challenge is that a no-guarantor policy must come with a financial sustainability plan which we are not seeing in this situation. So then, it brings us to the crowding out of people who genuinely need it…”
Dennis Appiah Larbi Ampofo

Mr Ampofo explained that if there is enough funding provided for the Student Loan Trust Fund, students won’t be found in a predicament where they are contemplating payments of fees, as is the case now. He highlighted that the current challenge of the Fund which has led to payment delays must be tackled immediately.

Furthermore, he iterated that instead of “mourning the institution” of a good policy such as the no-guarantor, there is the need to close the “funding gap because the no-guarantor policy is good because genuinely, students who do not have guarantors can also access the loan”.

Elaborating on the delay in payment of loans to students, Mr Ampfo indicated that the Union has been quiet over the students’ loan debacle for some time. This, he explained, is purely because it has opted to use a lot of the backroom conversation trusting that it will yield some fruitful results.

“But unfortunately for us, from last semester till date, we have about 70, 000 Ghanaian students sitting on the system of the Student Loan Trust Fund who have not been paid. What that means is that in a timebound payment such as the school fees, you have a lot of the students in anxiety, lots of students risking deferment due to the non-payment of these loans. That is our worry at the moment because you consider the single most important barrier to tertiary enrolment in Ghana, which is cost.”
Dennis Appiah Larbi Ampofo

Challenges of loan payment to students

The NUGS President lamented that the situation is critical because the Fund is in arrears and the troubles of students are compounded because unlike previous times when there was a guarantor policy, it limited the number of students who could apply for the student loan. However, he revealed that the no-guarantor policy has doubled the enrolment on the application and now there’s a lot of pressure on the system.

Additionally, Mr Ampofo expressed worry over this semester situation for students when it comes to payment of fees since registration is about ending. For some institutions such as the University of Cape Coast, he noted that registration has ended.

“Imagine a student who depends on the Student Loan Trust Fund to pay fees. It is a difficult situation for such a student. Unfortunately for us, a school like KNUST is writing exams today, University for Business Integrated Development Studies, Wa, has also issued warning notices to students that they risk deferring if they do not pay their fees.”
Dennis Appiah Larbi Ampofo

Furthermore, Mr Ampofo emphasized that a lot of these students depend on these student loans, owing to this, his office has received petitions from local secretariats, Student Representative Councils and students across the country lamenting the situation they find themselves in.

One of the most sustainable ways of ensuring that the cost barrier is eliminated, he highlighted again, will be the sustenance or effectiveness of student loan systems.

“… But unfortunately for us, students have applied for student loans [since] last semester [and] they’ve not received payment, this semester, they’ve not received payment… The only way out is for improved funding for the scheme to ensure that students do not miss out or defer their courses of study.”
Dennis Appiah Larbi Ampofo