Govt touts benefits of new loan law

national February 01, 2017 01:00

By Ketkan Boonpen,
Mayuree Sukyingcharoenwong
The Nation

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But concerns voiced on whether it breaches people’s rights



MANY benefits – including better efficiency and a higher rate of loan repayment – would come from implementation of the new Student Loan Fund (SLF) Act 2017, Education Ministry permanent secretary Chaiyapruek Serirak said yesterday.

However, a former Human Rights Committee Lawyers Council of Thailand member, Surapong Kongchantuk, said the new law was inappropriate, as it would violate people’s personal rights and could also be deemed to break the labour protection law.

Chaiyapruek said the new law, which has been in effect for just a few days since Friday would allow the SLF to access the personal information of its borrowers. That includes about 1 million debtors with repayments overdue.

It would also enable the Revenue Department to ask employers to deduct portions of debtors’ salaries for repayment – because debtors would have to sign a consent form allowing deductions as part of loan contracts.

To be in line with the new law, the ministry will set up a panel to supervise and assess educational institutes under the SLF, he said. The panel, chaired by the permanent secretary of education and including Education Ministry officials, would also provide recommendations to the SLF, Chaiyapruek said. That would give the ministry a bigger role in ensuring standards at educational institutes, plus the selection of studies and good care for debtors.

But Surapong said: “Making salary deductions before workers get fully paid – as per the agreed amount – is a violation of the labour law. But workers wouldn’t be able to sue employers [to stop this] because of the new law.”

Surapong said the loans were already backed by the civil code, which allowed lenders to sue overdue debtors.

But people on the street appeared more receptive to the new law’s idea to allow companies or organisations to deduct sums from salaries of employees who still owe money to the SLF or for the income-contingent student loan to repay the debt.

Bangkok-based graphic designer Kriangsak Tangjerdjarad, 40, who borrowed from the SLF, said that he agreed with the new law, as he expected debts to be deducted from people’s salary would conform to the old SLF rate, which was low. “The SLF’s yearly repayment rate, being slightly over Bt1,000 in the first year before stepping up accordingly, won’t affect people’s expenses,” he said. And this would be better than a hefty fine or a blacklist punishment faced by many who had refused or ignored repaying their debt, he added.

Kriangsak said he borrowed from the SLF since his third year in university and the debt amounted to Bt60,000. After graduation, he started to repay the debt and the first year rate was only Bt1,000. He plans to complete his full repayment this year.

“I agree with this law as it will get back money to fund younger generations from low-income families to have a chance to get education.

“It is also the responsibility of borrowers to repay the money, so deducting it from their salaries will be all right and even more convenient than going to do repayments at a bank,” Kriangsak said.

Tour guide Chananchida Chinnawong, who didn’t borrow from the SLF, said it was a good idea if the deductions from debtors’ salaries were done at a minimum rate per month so the government could get its money back to give opportunities to other students. “It’s better than letting people get away with not repaying the SLF debts out of a claim to have no money,” she said.