The Students Loan Trust Fund (SLTF), which subsidizes loans for tertiary students studying in accredited institutions, is grappling with a severe funding challenge, Kofi Asare reveals.
This is evident in its inability to disburse approximately GH₵50 million to qualified applicants for the 2023 academic year.
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Kofi Asare, the Executive Director of African Education Watch (Eduwatch), has warned that the situation is likely to worsen in the 2024 academic year due to insufficient government financing of the student loan scheme.
According to him, Inadequate funding has resulted in delayed loan payments and limited the number of successful applicants to only 70 percent.
The 2023 West African Senior School Certificate (WASSCE) results mark the highest achievement in the four years of the Free Senior High School (FSHS) policy.
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With the majority of candidates obtaining grades A1-C6 in core subjects, the demand for tertiary education is expected to surge, putting additional pressure on the SLTF.
Although progress has been made in eliminating the guarantor system, the current circumstances surrounding the SLTF’s operations undermine the very essence of the scheme, according to Asare.
For existing students, the average student loan of GH₵2,000 a year falls short of meeting the financial needs of those pursuing regular tertiary programs in humanities, which costs approximately GH₵15,000 annually for tuition, accommodation, and other educational expenses.
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This financial barrier to tertiary access continues to threaten the educational opportunities of economically disadvantaged students.
Kofi Asare noted that the loan scheme’s underfunded nature primarily benefits existing students at the expense of prospective students in need of financial assistance to honour their admissions.
Prior to 2022, only 39 percent of WASSCE candidates progressed to tertiary education each year, suggesting that approximately 250,000 secondary school graduates were unable to enroll in higher education.
However, the implementation of the free SHS policy has resulted in a 50 percent increase in second-cycle enrollment, exacerbating the situation and leading to potential youth unemployment challenges.
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Stakeholders are calling for improved funding and review of the student loan scheme to raise the minimum share of GETFund to the statutory fund from its current two percent to at least 10 percent to ensure the SLTF gets enough funds to support students’ needs.
“The law must be reviewed. As of now, the law states a minimum of two percent and because of that, GETFund is always going for the minimum; so, the law must be revised to make it 10 percent so that SLTF can get enough funds to operate.
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“If we fix this financing architecture for the SLTF, then we can have a students’ support system that will disburse funding much earlier because they are receiving funding at the right time, and also increase the average disbursement to meet realistic fee levels,” Mr. Asare emphasised.
