/ 1 December 2022

QUIRINO Rep. Midy Cua filed a measure institutionalizing the Higher Education Loan Program to be provided by the Development Bank of the Philippines and the Land Bank of the Philippines.

House Bill 6291 or the proposed Higher Education Loan Program Act seeks to provide a complementary program to the Unified Student Financial Assistance System for Tertiary Education.

Cua said that the various student loan programs implemented by the government in the past years including the “Study Now, Pay Later Plan” fizzled out because of weak loan collection mechanisms. A report by the Commission on Audit cited a collection rate of 2.09 percent or P2.8 million of the P138.23 million loan receivables.

In its annual audit report in 2021, the COA said that the Student Loan Program under UniFAST remained unimplemented because of the absence of a loan repayment mechanism in the Memorandum of Agreement between the Commission on Higher Education and UniFAST Board and the Development Bank of the Philippines.

“Our experiences in providing for student loan programs over the last four decades point to the incompatibility of National Government Agencies as the primary implementing arm of laon progams,” Cua said.

The lawmaker added that the design, implementation, monitoring, and evaluation of loan programs are the expertise of financial institutions whose primary business is in lending.