Aside the difficulty in getting guarantors, students are running away from the Students Loan Scheme due to rising graduate unemployment, as they are not sure they can land jobs immediately after school and start paying off the loan.

Debtors of the Student Loan Trust Fund have a one-year grace period when they leave school, which is the national service year, to start settling their debt.

This means that the Fund assumes that students who are indebted to it will get jobs just after their national service to start repaying the loan.

However, with graduates currently spending between two and four years or more after national service without jobs, students who enter tertiary institutions feel they could be in for trouble if they apply for the loan.

The students argue there is no assurance they will land jobs immediately after school, whilst interest on the loan begins to pile up regardless of whether or not a beneficiary has a job.

Ernestina Adwoa Yeboah, a level 400 student at the Ghana Institute of Journalism, said even though her father is a SSNIT contributor she is not ready to take the loan.

Her fear is that she might not be working immediately after school and she will not be comfortable with the mindset that she is owing and needs to settle it at a time when she is not even working.

“There is no assurance that you will be working immediately after you finish school. I think the SLTF will give you only one-year grace period to start paying for the loan. What if after the grace period I am still not working? What would I do?” she asked.

So to her if management of the Fund will find a way of making payment flexible for those who become unemployed for like two or three years before getting a job then it will encourage a lot of students to go for the loan.

The Student Loan Trust Fund as part of requirement to get the student loan wants an applicant form guaranteed by SSNIT contributor, recognized religious body, metropolitan, municipal and district assembly and corporate body.

Bernice Boateng, a final-year students at the University of Ghana said she was not moved by the idea to go for the loan simply because she will not get a guarantor anywhere.

“My mum is not a SSNIT contributor, this is because she does her own work, I do not know anybody at the Municipal assembly to help me get the assembly to guarantee for me.

Asked whether she would have wanted the loan, she said yes but the difficulties in accessing it discouraged her and moreover she realized that even if she goes for it she will be indebted after leaving school and that one will become a burden on her when she does not get a job as soon as possible.

It is reckoned that Universities and the other tertiary institutions churn out about 68,000 graduates yearly without corresponding high number of jobs being created to absorb them.

The formal sector is said to be the preferred job destination of graduates, but it employs less than 40% of all graduates. Worse still, the job expectation of graduates does not match wage offers given by employers.

Meanwhile, there has been a sharp decline in funding to needy students by the Students Loan Trust Fund, with disbursements decreasing by 9.6 percent from 2010 to 2011 and a further 28 percent from 2011 to 2012,” the Auditor General’s Report for 2014 has revealed.

In 2010 loans were disbursed to 26,955 students, a number which decreased to 18,605 in 2011, and decreased further to 13,833 in 2012.