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Minister of Education, Hon. Andrew Holness, is suggesting that government consider sharing credit information with financial institutions abroad as it seeks to recover money borrowed by students to complete their tertiary education.
He was contributing to the debate on the Credit Reporting Bill in the House of Representatives yesterday (February 9), which, among other things, provides for the sharing of credit information between specified bodies.
While no such provision is stipulated in the Bill, Minister Holness said that as the legislation evolves in the sharing of consumer information, the move could be considered.
“So, as the legislation evolves and the markets begin to merge, you will find that students, who got their loans here and migrate and don’t repay their credit ratings in other jurisdictions, may be also affected,” he pointed out.
He stressed that while the government wants to make it easier for persons to access loans, it must also become extremely difficult for them to default on their loans. “Once we have reached that stage in the market, then interest rates will begin to fall,” he argued.
In the meantime, with the legislation paving the way for the creation of a credit registry, which will provide credit history on borrowers, Minister Holness said that the requirement for guarantors for Student Loan Bureau (SLB) borrowers should be removed.
He said that the performance of students in repaying their loans may affect the credit rating of the guarantors in the future.
Minister Holness explained that the SLB has had to insist on guarantors as a means of sharing the risk of default by borrowers.
However, he said that by removing this requirement for guarantors, the government should be able to increase access to credit, for students. “We are actively looking at how we can leverage this to support access to tertiary education in the long run,” he stated.