The Students' Loan Bureau (SLB) is Jamaica's primary provider of tuition loans for tertiary education. It operates a revolving loan fund to provide loans to eligible students based on financial need. Loan demand has increased exponentially in recent years due to growth in tertiary enrollment and tuition fees. The SLB offers targeted loans for undergraduate study over 15-20 years at 9% interest, as well as parent plus and postgraduate loans. Moving forward, increased funding sources and reductions in delinquencies will be important to sustainably meet the growing demand for student loans.

1. STUDENTS’ LOAN BUREAU
Funding Tertiary Education – The SLB’s Role
Presented by : Analisa Allen
February 25, 2014

2. OVERVIEW- STUDENTS’ LOAN
BUREAU

The Students’ Loan Bureau (SLB) is the only
institution in Jamaica primarily geared towards the
provision of tuition loans for tertiary education- est.
in 1970 under the Students’ Loan Fund Act

The SLB operates a Revolving Loan Fund, which is
used to fund tuition loans to eligible students.

Most loans are issued based on need, assessed
through a Means Test.

Grants are also offered.

3. OVERVIEW- STUDENTS’ LOAN
BUREAU

Mission Statement:
“To provide affordable financial assistance through
a sustainable revolving loan fund to students in need
who are desirous of pursuing tertiary education,
thereby contributing to social mobility and nation
building.”

Tuition Loans only

4. STRUCTURE – STUDENT LOAN
PRODUCTS
Loan Products offered by the SLB :
Targeted
Loan ( General Loan for undergraduate
study)
Parent
Post
Plus Loan (For undergraduate study )
Grad Loan ( For postgraduate study)

5. STRUCTURE – STUDENT LOAN
PRODUCTS
TARGETED LOAN

Students between the ages of 16 - 50

Those who are eligible for tertiary education but unable to
finance their higher education (full tuition)

Those who are able to only fund part of their tuition but
still considered vulnerable

Jamaican citizens

Persons who have applied to or attending an Approved
Tertiary Institution (ATI) in Jamaica or the region*

6. STRUCTURE – STUDENT LOAN
PRODUCTS
TARGETED LOAN CONT.
Interest Calculation:
 9% add on per annum
A method of calculating interest whereby the interest
payable is determined at the beginning of a loan and
added onto the principal. The sum of the interest and
principal is the amount repayable upon maturity.

7. STRUCTURE – STUDENT LOAN
PRODUCTS
TARGETED LOAN CONT.
Repayment Period:
Repayment commences the January following the
completion of the course of study*

Courses
of study with the average tenure (3-4
years) : 15 year loan tenure (from commencement
of programme until loan maturity) (increased in
2012 from 10 years)
Courses of study with longer tenure(5 years): 20
year loan tenure (from commencement of
programme until loan maturity)

Payments
in moratorium

8. STRUCTURE – STUDENT LOAN
PRODUCTS
TARGETED LOAN CONT.
Repayment Period:
 Loan payments become due on the first of each
month
Grace Period – to the 10th of the following month
Late
fee: $500 per late payment (currently)

9. STRUCTURE – STUDENT LOAN
PRODUCTS
TARGETED LOAN CONT.
Repayment Period- Assistance to those who are
facing difficulties in repayment:
 Restructure of loans
Graduated Payment plans
Deferral of loan payments

10. STRUCTURE – STUDENT LOAN
PRODUCTS
PARENT PLUS & POST GRAD LOANS
Parent Plus Loan:
 Undergraduate Study
Maximum of $500,000.00 per loan
 Repaid monthly via salary deduction – maximum
36 months
Interest rate 9% add on per annum

11. STRUCTURE – STUDENT LOAN
PRODUCTS
PARENT PLUS & POST GRAD LOANS
Post Grad Loan:
Post Graduate Study
Maximum of $1,200,000.00
 Repaid monthly via salary deduction – maximum
36 months
Interest rate 9% add on per annum

12. SLB VS STUDENT LOANS IN OTHER
TERRITORIES
Structure
SLB
Barbados
Canada
Collateral
N/A
*
*
Guarantors
*
*
*
Repayment
Period
15 years
20 years
Between 5- 12 years
depending on the
amount borrowed
Standard 10 years
9%
4%
+ 5%, or + 2.5% or
Newfoundland and Labrador
and Prince Edward Island are
the only provinces where there
is no interest on the provincial
loan
Interest rate
Method of
calculation
Add on basis
Variable Interest
rate
Students have the choice of
opting for a fixed interest rate of
prime interest rate + 5%, or a
floating interest rate of prime
interest rate + 2.5%.

13. SLB VS STUDENT LOANS IN OTHER
TERRITORIES
Structure
SLB
Barbados
Canada
Monthly
Payment -
Flat payment
Flat payment
Income Contingent
N/A
*
N/A
Maximum of
6 months
Determined
by a
committee if
loan was
taken for full
time study
and 6 months
if loan was
taken for
part-time
study
Dependent on issuing body
Bonding
Grace Period

14. GROWTH IN LOAN DEMAND

Loan demand has increased at an exponential rate –
especially over the last 7 years .

This has resulted in significant increase in
disbursements by SLB over the 7 year period.

Total applications received for 2012/13 total 16,676 or
23% over the previous year; for 2013/14 applications
15,300 or 8% less.

Despite this reduction, actual disbursements are
projected to increase from $3.6mn in 2013 to $4bn in
2014.

15. DEMAND FOR STUDENTS’ LOANS:
2007 - 2014
Table 1
Loan Demand/Approved and $value Disbursed 2007/8 to 2013/14
2013/14
2012/13 2011/1
2
2010/1
1
2009/1
0
2008/9 2007/8
Change
2007 – 2014
$/#
%
15,300
16,676
13,600
9,973
8,738
7,516
6,600
8,700
132%
# Applications 12,800
disbursed/
projected
13,000
12,100
9,899
8,623
7,447
6,467
6,333
98%
Value of loans $3900
disbursed
(projected) $mn
$3600
$2,750
$2,010
$1,598
$1,101 $840
$3,060
364%
Tuition Fees$000 305
277
227
203
185
148
175
135%
# Applications
received
130

16. MAJOR FACTORS IMPACTING
DEMAND
Growth in the number of students enrolled in
Tertiary institutions
 Increase in the number of applicants for students
loans (30% of enrolled students currently funded
by SLB).
 Annual Increase in tuition fees charged by
institutions.


17. MOVING FORWARD
Increased funding
 Reduction in delinquency level
 Change in legislation
 Public / Private Partnerships
 Individual Savings
 Credit Bureaus


18. CONCLUSION