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Student loan payments to be cut from salaries

Aug 01. 2018
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THE STUDENT Loan Fund (SLF) will, starting next year, deduct from the salaries of about 1 million company employees who had failed to repay loans they had taken for their studies.

“We will arrange for the deductions in collaboration with giant companies such as CP,” SLF manager Chainarong Katchapanan said yesterday. To date, the SLF has granted loans to about 5 million students. These recipients are required to begin repaying their loans two years after graduation. About 1 million recipients have cleared all of their debts. Another million are still within the two-year grace period. But of the 3 million now required to pay back their loans, just 1 million have been doing so. The problem has prompted the SLF to explore more efficient ways to collect repayments. Among their solutions is to collect repayment instalments through the employers of loan recipients. 

Beginning last month, the SLF started deducting from the salaries of its loan recipients who were working at the Comptroller-General’s Department (CGD). From this month, the SLF will arrange such deductions from the payroll of all loan recipients working at agencies under the Finance Ministry. 

“We plan to expand the repayment programme further to cover all loan recipients working in the government sector and receiving their salary via the CGD,” Chainarong said. He added that with a very low interest rate, deductions would range between Bt100 and Bt300 only. 

Asked about a high-profile case in which a teacher who acted as a loan guarantor is now on the verge of losing her house and land plot, Chainarong said his office had been trying to help the teacher by summoning her students to negotiate their debts. 

The teacher, Vipa Banyen, had signed as a guarantor for dozens of students when they applied for a loan from the SLF years ago. 

Many of them had subsequently defaulted, leading to the forfeiture of Vipa’s assets. Vipa has recently called on the SLF for help. After her case made headlines, five of her former students came forward to clear their debts with the SLF. Three others have continued to default. 

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