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Students default on loans

Students studying with the assistance of the Namibia Students Financial Assistance Fund (NSFAF) recently told the Economist they refuse to pay back their study loans as they do not earn sufficient salaries once they become working graduates.
The NSFAF is a loan/grant scheme that was designed to replace the Public Service bursary scheme of which purpose was to train people to work solely in the Public Service. The operations of the NSFAF were approved by Cabinet in 1996 and were implemented in 1997. Ultimately the NSFAF was established and became operational under Act 26 of 2000.
The two main criteria for providing study loans to students are allocation according to a regional quota and priority fields of study.According to the website of the Ministry of Education, the NSFAF receives more than 17,000 applications each year, but only offer loans to just less than 4000 students each year.
The NSFAF act states clearly that students must pay back their loans once they have completed their studies or if they fail to complete their studies. But recently, numerous media reports highlighted the reluctance of graduates to pay back their loans. The fund’s total accummulated liabilities now run into the many millions of dollars. Failure to recover loans from former beneficiaries has left the fund with outstanding creditors exceeding N$400 million. Besides technical glitches such as the lack of a proper electronic database to record statistics of beneficiaries from the fund, loan holders have simply not adhered to contractual agreements that state that repaying of the loan should commence two years after graduating.
 Many students have raised concerns with the funds allocated to them saying that although the loan covers for their tuition fees, the amount given to them is simply not enough and does not accomodate other expenses.The loan only covers tuition fees and not accommodation.” If the ministry wants us to pay back the loan, let them give us atleast enough money to buy stationery and pay for rent. It is a loan after all and I am obliged to pay it back, but the amount is too little,” said a disgrunted Polytechnic of Namibia student.
“If I could afford to pay back the loan, I would definately do so because I care about Namibia and would love to see others receiving the same education Idid through the help of the NSFAF,” she  said, adding that perhaps the ministry should try to determine how much loan holders earn and from what salary scale they should be asked to pay back. “Those driving posh cars and living in posh apartments should pay back. They seem to have more than enough (money),” she said. She added that the reason loan holders are not paying back the loan is because most graduates find themselves unemployed even two years after graduating. “Well most graduates don’t have jobs or have jobs that leave them just over broke. The government should just consider it as bad debts written off,” she said.
Another loan holder who graduated a year ago is Mekondjo Vatileni who received a loan in his final year of study. He too, is struggling to pay back the loan.” I find it extremely difficult to pay back because not only do I feel that I’m entitled to that money but also because I have a child to care for, my rent is N$6000 per month and I help out with my siblings who are still students. I take a taxi to work every single day and will be left with next to nothing if I had to pay back. Why don’t they first demand the millions stolen by high ranking government officials before they decide to take food out of our mouths,” bemoaned Vatileni his own predicament.
He added: “Why should we pay back when numerous graduates are jobless and those who are working have to pay ridiculous rental prices because they can’t afford to by their own houses. Millions of dollars have gone missing. With that money, every student could have gone to university free of charge and the government could have build a house worth a million for each and every single citizen. They must first get back all the money stolen by the big fish before they target the poor students.”
Another graduate loan holder who chose to remain anonymous said although she went to enquire about the process of paying back the loan, she was greeted with an uncertain reply and was told to come back the follwing day.
“ I was there (NSFAF office) and asked them what’s the process to start paying back, (but they) told me to come back the following week. Haven’t been back, that’s last year. How do you tell someone to wait when they were willing (to pay back the loan)?” she quizzed.
“I am a loan holder and I only plan to pay back once they come up with a proper payback system. Firstly NSFAF does not have a specific account you can pay into, so you will basically just be paying Ministry of Education coffers, secondly there is no specific amount to pay back, UNAM never refunded some of our money but they want us to pay back the loan in full, and thirdly the moment I started working, I went to NSFAF and asked how I can start repaying the loan but they told me not to worry as they would call me.
That was in 2011. Next thing I saw was the lawyer nonsense in the papers,” explained Esther Nangolo, a graduate of Neudamm. The Economist has it on good authority that loan amounts have recently been doubled, sometimes even more than the total tuition fees.
For instance, a second year Bachelor of Nursing student gets a loan for N$33,000 while the actual class fees are about N$12,000. Students are then refunded the surplus amount after the tuition fees have been paid at the end of the academic year.

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