By Sheria Brathwaite
The Student Revolving Loan Fund (SRLF) is undergoing a restructuring process to cut down on delinquent borrowers and improve the department’s efficiency, loans and collections manager Rommel Aimey has told Barbados TODAY.
The process began as the government relaxed all the COVID-19 health restrictions, signalling the reopening of the economy.
Aimey said the heightened periods of the pandemic had a significant impact on the fund given the high rise of unemployment among the populace. He explained that borrowers had difficulty repaying their debt during this period and there was also a notable dip in people applying for loans.
“The pandemic had a significant impact on the SRLF. In terms of the jobs, people were put on half pay while others were let go from work, so that would have directly impacted our delinquency levels for sure. And there was definitely a drop in the number of loan applications,” he said.
“So with delinquency, that was like a ripple effect because of what was happening with the employment situation in the wider society and it progressively increased. However, while it appeared to have increased higher than normal levels on the books, it was not a situation where people were not paying at all and the delinquency level rose because of arrears. When you net it off in terms of the amount of applications that were coming in, it looked like the delinquency levels were much higher.”
With the government relaxing all of the COVID-19 health protocols in the latter half of 2022 and the economy returning to a sense of normalcy in the following months, Aimey said the situation had improved.
Borrowers were back on payroll and restarted their payment plans and with regional and international schools reaccepting students to complete degrees in-person, there was a renewed interest in the fund, he said.
Aimey added that a restructuring programme was implemented to stabilise delinquency levels, attract new applicants and run the department more efficiently.
“As it relates to delinquency, it is at a reasonable level right now but we would always like to see the delinquency level lower than what it really is and we are actively putting things in place to keep the delinquency at a minimum. Delinquency levels are around ten to 15 per cent high overall. Naturally, it is of concern but it’s not at epidemic levels that are out of control,” the loans and collections manager said.
“We have an ongoing restructuring process at the fund where we are more in line with modern structures and we are putting things in place to be more efficient at the fund. We are reaching out to people to deal with delinquency at an earlier point in time so that persons are in a better position to handle it. We changed up some of the functions of staff so that we could be more efficient in terms of our customer service by making sure that the customer had a better experience. We have also put a new strategy in place to make sure that we can get in contact with all the beneficiaries, all the sureties and pledgers so that they can come in or reach out to us and put proposals in place so that any arrears on the loans or anything can be dealt with.”
Aimey said the SRLF was also undergoing a campaign to make its presence more felt in the community. He said that many students were not aware of the fund and its offerings, and representatives were therefore making presentations at various schools.
“We want to make sure that persons understand that the SRLF is the premier institution when it comes to lending as far as education is concerned,” he said.
The SRLF replaced the Higher Education Loan Fund when it was established in 1977. Since 2009, applicants can apply for a maximum loan of $125 000, an increase from $50 000 in the 1990s.
Aimey said that while many applicants wanted loans to study courses abroad, especially in Canada, several people were also applying to study locally, regionally and online.
“The studies range – some people want to do design, some people want to do engineering and some people want to pursue a pilot licence – so it’s not one particular area of study that attracts people. What is interesting, however, is that people are not doing the traditional areas of study like finance, doctoring or lawyering. They are diversifying, doing combinations of different programmes and basically trying to put themselves in a position where, on completion of study, there is an area of employment that they can get into.
“We also encourage persons that when they’re looking at courses of study, they try to find areas where there are viable employment opportunities where they can obviously repay their loans, but feel fulfilled in their career journey as well,” Aimey said.
sheriabrathwaite@barbadostoday.bb
