Accra, Nov. 21, GNA - The Students Loan Trust Fund (SLTF), which would replace the Social Security and National Insurance Trust (SSNIT) Students Loan Scheme, would start operating in the 2006/2007 academic year, Mrs Kokui Adu, Acting Chief Executive Officer of the Fund, announced at a press briefing on Tuesday.

She said the Fund would this year be managed in collaboration with SSNIT to ensure authentic guarantors.

Mrs Adu said loans would be granted to fresh students, who entered accredited tertiary institutions this year adding that the loan amount for students this year would be based on the programme of study of individual students.

"The long-term loan amount would, however, be based on the needs of the student," she said, explaining that it was likely that a medical student would need more money than the one pursuing humanities. The SLTF would have campus offices that would be the first point of call for students, she said, and added that money would be loaned only to students, who qualified and applied.

Students who qualify must be financially needy, be pursuing an accredited programme and must have good academic standards, she said. Mrs Adu said the loan repayment period for a student pursuing a four-year programme would be 15 years, including the study period, national service period and a two-year grace period to look for employment.

"The loans could be paid by monthly deductions from the beneficiary's salary through the employer; direct periodic payments to the Fund by beneficiaries or outright payment of the total amount. Beneficiaries could also encourage employers to pay off their loans as part of working agreements," she said.

Touching on interest rates, Mrs Adu noted that interest rate on the loan was not profit but was meant to sustain the Fund for younger generations.

Sources for funding would mainly be from the Ghana Education Trust Fund and would be dependent on loan repayment but the Fund would also solicit support from development partners, SSNIT, tax deductions and voluntary contributions.

Mrs Adu said students would need individual guarantors, who were SSNIT or non-SSNIT contributors, Ghanaians, someone who knew the applicant personally, had employment with at least eight years to retirement and income, which is sufficient for guarantee. She said guarantors may guarantee up to two applicants but parents could guarantee for all children.

As an identification procedure, fingerprints and facial recognitions of the applicant would be taken. There would also be guarantee from tertiary institutions that the student has been enrolled. The SLTF would gradually replace the SSNIT loan scheme, Mrs Adu said.

Ms Elizabeth Ohene, Minister of State at the Office of the President, called for support for SLTF to enable the younger generation to benefit from it.

She encouraged beneficiaries to re-pay the loans and said funding must not be a problem for only the trustees but must be the concern of all.

"No loan can be free," she said.

Ms Ohene said the Presidency was interested in how the new loan scheme worked and assured the public that where there were difficulties "we will find a solution together.

"Let's make the scheme work, it may have difficulties but we need the support of all especially those who access it," she said. Dr Kwabena Quansah, Chairman of the Fund, said SLTF was established in December 2005 under the trustee incorporation Act 1962, Act 106, to provide financial resources for the benefits of Ghanaian students and to promote and facilitate national ideals.

He noted that the students' loan scheme under SSNIT gave a lot of problems and even distracted SSNIT from performing its core functions. Since 1998, the SSNIT scheme had disbursed 875.6 billion cedis to 253,493 students and the SLTF hoped to do more, Mr Quansah said.