Student loans play a vital role in enabling individuals to pursue higher education and improve their lives. By honouring loan agreements, borrowers contribute to the sustainability of educational funding, foster personal responsibility, alleviate the burden on government resources, and promote fairness and equal opportunities.
However, the issue of loan repayment has been a contentious topic for quite some time as Namibians feel entitled to what they consider their piece of the cake.
Having grown fed up with the stubborn refusal of past beneficiaries the Namibia Student Financial Assistance Fund (NSFAF) decided to take more aggressive action against defaulting borrowers, including parliamentarians. The fund has been struggling to recoup N$9 billion in loans extended to 132 000 beneficiaries.
While government has made huge amounts of money available for this important need, it is time those who have been gainfully employed after benefitting from the fund start paying back what they owe.
NSFAF received around N$2 billion for the 2023 fiscal year, while government has spent nearly N$7 billion between 2018 and 2022 on 70 233 students who were provided with financial assistance by NSFAF.
This year, 22 178 students have been approved for loans, while 7 946 were unsuccessful, which is 30% more students than last year, when the fund granted 17 096 loans.
NSFAF received over 30 000 loan applications.
By repaying student loans, borrowers contribute to the sustainability of NSFAF and enable future generations to access higher education. The recovery of outstanding loans, as demonstrated by the NSFAF’s recent debt-recovery drive, ensures that funds can be reinvested to support other deserving students. A self-sustaining and revolving fund allows more individuals, particularly those from disadvantaged backgrounds, to receive financial assistance, breaking the cycle of generational poverty and promoting equal educational opportunities for
all.
Paying back student loans instils a sense of personal responsibility and accountability among borrowers. It teaches individuals the importance of fulfilling their financial obligations and managing their resources effectively.
By honouring loan repayments, graduates demonstrate their commitment to their own educational journey and contribute to the overall integrity of the lending system. This accountability extends beyond the individual, as it sets a positive example for future generations, encouraging them to take their financial responsibilities seriously.
Loan repayment also reduces the burden on government resources and allows for the allocation of funds to other critical areas, such as healthcare and infrastructure development.
When borrowers repay their loans, the government can redirect those funds to initiatives that benefit the entire society. Furthermore, by fulfilling their loan obligations, graduates contribute to the overall economic stability of the country, as they are better positioned to participate fully in the workforce and contribute to the tax base, fostering economic growth and development.
Paying back student loans promotes fairness and equal opportunities for all individuals seeking higher education. The availability of student loans enables students from diverse socioeconomic backgrounds to pursue their academic aspirations.
However, failure to repay loans creates an imbalance by burdening future generations with the debt accumulated by defaulting borrowers. Upholding loan repayment ensures that the financial assistance system remains equitable, allowing the fund to assist a larger number of deserving students and maintain a level playing field for all individuals seeking educational advancement.
Paying back student loans is not only a legal obligation but also a moral responsibility that individuals should fulfil and pointing to the fund’s administrative shambles in past years does not exempt anyone from paying what they rightfully owe. Because some refuse to honour their debt almost 8 000 young Namibians can not get the funding they need to study, which in turn continues to grow the unemployment numbers and the frustration that comes with it.
In hindsight, NSFAF has been embroiled in a protracted legal tussle with its suspended CEO, Hilya Nghiwete, so much so that it had to pay her full salary for years while on suspension.
No right-minded NSFAF beneficiary or taxpayer would want their hard-earned money end paying two CEOs.
In 2018, it was reported that NSFAF was looking for evidence to verify around N$300 million it paid through cheques as student loans and grants between 2013 and 2003.
As if that is not reckless enough, the same fund also paid more than N$200 million since 2014 in tuition fees for medical students at foreign universities that are neither vetted nor recognised by the Namibia Qualifications Authority.
A total of 313 students benefited from these reckless actions. The fund may never recoup around N$1.7 billion it paid in student loans or grants between 1997 and 2010.
So while we encourage loan repayment, the onus still lies on NSFAF to prove that it can be trusted with public funds.