Debt restructuring for student defaulters to start in Nov

Debt restructuring for student defaulters to start in Nov
Online resources are used by students to learn how to pay off student loans. ( Bangkok Post image )

On Tuesday, the Student Loan Fund announced that it would start restructuring student defaulters’ obligations in November.

SLF director Chainarong Katchapanan informed Justice Minister Tawee Sodsong on Tuesday that student loans may be required to undergo restructuring starting in November after the necessary requirements were finished second month.

Mr. Tawee claimed that reform may be advantageous for undergraduate borrowers who went into default as well as their guarantors. In the event of reform, the Legal Execution Department had halt action against them.

The motion abides by the revised legislation governing student loan funds. The default fine is reduced to 0.5 % per year instead of 18 %, and loan interest is capped at 1 % rather than 7.5 % annually.

Debtors’ repayments will first be subtracted from the loan principal following debt reform, with interest payments and fines following. According to Mr. Tawee, this is done to increase youthful women’s access to education.

The fund had 6.58 million borrowers as of last month, of which 54 % had not yet made payments and 28 % had finished.