Teachers Credit Union owed over $500,000 by six students

Manager of the St. Vincent and the Grenadines Teachers Co-operative Credit Union (SVGTCCU), Julian Jack says he welcomes the efforts of Prime Minister Dr Ralph Gonsalves to “hunt down”{{more}} those persons who have not been meeting the obligations of their Economically Disadvantaged Student Loans.

On October 30, during the official opening ceremony of the new SVGTCCU headquarters, Gonsalves disclosed that there were a number of persons still owing on loans which were obtained from some financial institutions here.

The SVGTCCU is one of the institutions which has been burdened with outstanding repayments under the Economically Disadvantaged Student Loan programme.

In an exclusive interview with SEARCHLIGHT on Wednesday, November 11, at his new office, Jack revealed that six persons, owing a total of over $500,000, are guilty of not repaying the Credit Union under the economically Disadvantaged student loan programme.

“We have written letters to the PM indicating that we have problems with these students and they are not paying. Government is the surety, so if the persons are not paying, then, the government is responsible for paying,” Jack said.

It was revealed by the Prime Minister, who is also Minister of Finance, that the outstanding loans have increased the Credit Union’s delinquency rate between 2009 and 2010 from 6.2 per cent to over 7 per cent.

According to Jack, “the PM’s figures were correct, and while the increase of the delinquency rate has not reached the critical stage, which is over 10 per cent, approaching over 7 percent is a matter of concern.

“As a board, we would like to keep our delinquency level to 5 or below,” the manager stated.

The delinquency rate of a financial institution is the number of loans that have delinquent payments divided by the total number of loans an institution holds.

Jack, who has served as manager of the SVGTCCU since inception in 1978, also revealed that the Credit Union’s delinquency rate saw a vast increase during this year.

“In 2007, there were only two persons who owed on their loans, but there was then an increase in the number of persons in 2010.”

Meanwhile, in respect to the economically disadvantaged student loans, Gonsalves said that he has to be particularly concerned about any delinquency in that regard, “because the government is the guarantor, and I think I received over the last year or so, I think, three letters from Julian Jack regarding the delinquency of 3 or 4 students.

“The Credit Union will be saved, but for me, these persons I have to find them…

“We have to help poor people children to get to university, and we have given them the responsibility to repay the loans, and where they don’t repay, we have to hunt them down wherever they are to ensure they repay,” the Prime Minister stated.

The Economically Disadvantaged Student Loan programme was initiated in 2002 and grants student loans up to $120,000 to persons who would not normally qualify.

The loans are guaranteed by the Minister of Finance. The Prime Minister said St. Vincent and the Grenadines is the only country in the Caribbean to have such a loan programme.