MANILA, Philippines – The Philippine government is studying a proposal to provide around P1 billion worth of guarantees to private schools that will secure loans to shoulder unpaid tuition during the coronavirus pandemic.
Facing lawmakers on Tuesday, April 21, Finance Secretary Carlos Dominguez III said the Land Bank of the Philippines (Landbank) – the government’s biggest financial institution – is looking into a proposed loan guarantee program covering 70% to 75% of a student’s unpaid dues written in his or her promissory note.
“The program is essentially for private schools. If private schools provide a ‘study now, pay later’ program and get a promissory note from the student to the private school, Landbank can lend [money to] the private school against that promissory note, probably 70% to 75% of the value of the promissory note. That is a program we are looking at,” Dominguez said.
The Department of Finance (DOF) chief explained the guarantee could primarily benefit returning overseas Filipino workers (OFWs) who would wish to develop their skills by enrolling in a private institution.
“We could probably go up to P1 billion very easily with that facility, but they are studying it. And really, this is aimed for people, especially the OFWs, who are coming back and who decide to upgrade their skills and go back to school. So this program will be available soon to the private schools. Kasi sa state-owned schools, libre na ‘yun (In state-owned schools, this is free already),” said Dominguez.
The DOF chief said Landbank is checking as well if the loan guarantee program can also cover promissory notes of high school and college students enrolled in private schools.
The national government already placed Luzon, an island of 57 million residents, under lockdown until April 30. Classes in all levels and government offices remain suspended. Other parts of the country are under localized lockdowns as well.
The Commission on Higher Education (CHED) already said it is up to private universities and colleges to decide whether to refund tuition and miscellaneous fees during the COVID-19 pandemic.
Some schools have since resorted to online classes to make up for lost time. But students from leading universities are calling on CHED to suspend e-learning activities, citing poor internet access and lack of equipment for disadvantaged students, along with an environment that is not conducive to learning. – Rappler.com