The Government of Ghana since independence made several attempts to establish a Students Loan Scheme. For instance, in 1971 and in 1975, Student Loans systems were operated by the Government of Ghana but failed as a result of change in governments and a high default rate.

The SSNIT Students Loan Scheme was however started in January 1988 and was administered by the Social Security and National Insurance Trust (SSNIT) on behalf of the Government of Ghana, under the Students Loan Scheme, (PNDC Law 276) of 1992.

The main objective of the Students Loan Scheme was to assist students in tertiary institutions defray personal and academic expenses including the cost of boarding, lodging, books, equipment and for such other purposes as may be necessary for their course of study.

The scheme to all intent and purpose was a temporary measure by Government to address a need especially, since SSNIT?s core business was to register workers to join the Social Security Scheme, keep their records, invest the contributions and pay benefits. As at the end of the actual loan disbursement period January 2013, 192,746 students have benefited from the loan.

GUARANTORSHIP INVOCATION
To ensure that the loan borrowed from the workers? contributions are incontrovertibly repaid, it was mandatory for each borrower to provide three (3) guarantors who were Social Security contributors and had been members of the Social Security Scheme for not less than five (5) years. This obviously was to guarantee the repayment of the loan. That is, in the event that the student loan beneficiary is unable to repay the loan, the guarantorship clause would be invoked. So far, 137,437 Guarantors have been released under this repayment exercise.

STUDENTS LOAN TRUST FUND
In 2006, the Students Loan Trust Fund (SLTF) was set up by the Government, as a permanent body to replace the SSNIT Students Loans Scheme. New applicants to the scheme from 2006 were serviced by the SLTF, and not SSNIT.

After the cessation of the SSNIT Students Loan Scheme, continuing students under the SSNIT Scheme however, continued to be paid till January 2012. This practically completed the SSNIT loan disbursement section of the process.

LOAN REPAYMENT OPTIONS
SSNIT established various means by which SSNIT Student Loan beneficiaries could repay the loans to relieve their guarantors and themselves, through the following methods:

a) Cash Repayment
b) Offset with Social Security Contributions
c) Deductions from beneficiary/guarantor benefits
d) Mandating employer to deduct from salary and
e) Refund from scholarship and bursaries

It is instructive to note that as at January 2014, approximately 70% (134,189) loan beneficiaries have completely repaid their loans whilst 30% (58,557) are still indebted to the Trust.

These loan repayments were made through a medley of the repayment options mentioned above.

OUTSTANDING LOAN MANAGEMENT
In its quest to not only reduce benefits processing time to serve contributors better and promptly and to clear the outstanding student loan debt, the Trust has commenced the use of Social Security Contributions to repay outstanding SSNIT Student Loan balances. This activity when carried out successfully will make more funds available to enable the Trust invest the loan recoveries prudently to sustain the fund.

Taking advantage of the Wide Area Network (WAN) the Guarantor/beneficiary Clearance and Release Process will no longer be handled at only one point, but will be decentralised to all the SSNIT fifty (50) Branches. This is to promote accessibility to our customers and to speed up benefit processing.

The recovery of the loans with Social Security Contributions is to be managed under four (4) groups or categories.

Repayment Group One
Student loan beneficiaries who have not made any repayment after the completion of their course of study, but are contributing to the Social Security Scheme comes under this group. For this group, their contributions will be used to offset the Student Loan indebtedness. This is in line with the Student?s Loans Scheme Law, 1992 (PNDCL 276) Section 12 (3).

Repayment Group Two
For Student Loan beneficiaries who have made some repayments after completing their course of study but still have outstanding balances on their loans and are also contributing to the Trust, their contributions will be used to offset their student loan indebtedness. This is in line with the Students Loan Law 1992 (PNDCL 276) Section 12 (5).

Repayment Group Three
Student loan beneficiaries who have not made any repayment and have no contributions after completing their course of study, but made Social Security contributions prior to accessing the loan come under this group. For this group, since they made some contributions before contracting the loan, their pre-loan balance will be used to offset the loan. This is in line with the Students Loans Scheme Law, 1992 (PNDCL 276) Section 12 (5) .

Repayment Group Four
Under this group ,student Loan beneficiaries who have not fully repaid their loans ten (10) years after completing their course of study and therefore have no contributions of their own with SSNIT .For this group, since the guarantors stood surety for them, the guarantorship will be invoked to repay the loan. This is in line with the Students Loans Scheme Law 1992 (PNDCL 276) Sections 6 (1) and 12 (5).

CONCLUSION
The repayment of outstanding SSNIT Student Loan indebtedness with social security contributions will definitely relieve guarantors and their corresponding beneficiaries in the various groupings above of their indebtedness to the Trust.

More importantly, the woes of going through a process of Students Loan Scheme clearance before any SSNIT benefit claim is processed and paid, will be a thing of the past. And with the decentralisation of the Student Loan repayment management to the fifty (50) SSNIT Branches across the country, customer service to our cherished stakeholders would greatly improve.

SIGNED:
MS EVANGELINE AMEGASHIE
CORPORATE AFFAIRS MANAGER

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