More than 80 schools keen to borrow from government–DOF


THE Department of Finance (DOF) revealed that an initial batch of over 80 private educational institutions have already expressed interest in accessing a credit facility that government launched last May.

This as the state-owned Land Bank of the Philippines (LandBank) has so far approved less than 10 percent, about P260 million, of the allocated P3 billion under its “Study Now, Pay Later” program for private educational institutions.

Citing its President and CEO Cecilia Borromeo’s report, the DOF said LandBank’s Board approved the applications of three institutions for loans under its “Academe” lending program.

The facility extends credit to private high schools, private technical-vocational education training institutions, colleges and universities with the goal of encouraging students to enroll under a “study now, pay later” setup by allowing their parents to issue promissory notes for the academic fees.

Borromeo’s report cited that six schools have partially submitted their documentary requirements for the program, while one loan application will be up for approval when the Bank’s board and credit committee meet on the fourth week of July.

“We continue to pursue opportunities to offer this program to as many eligible schools as possible through various means available,” she said in her report to the DOF.

Borromeo said follow-through meetings are being undertaken by LandBank with 15 other schools to assist them in assessing their loan eligibility, adding that the bank is also explaining the lending program’s benefits by arranging teleconferences with school administrators, distributing letters and brochures to potential borrowers, and through promotional efforts in the traditional and social media.

Another 61 schools across the country have likewise expressed interest in availing the credit facility, according to Borromeo.

Under the lending program, promissory notes will be refinanced or rediscounted, with schools allowed to borrow as much as 70 percent of the sub-promissory note per semester and subject. The lending program is available until June 30, 2021.

However, schools can only borrow up to a certain maximum amount based on the net borrowing capacity of the institution.

Loans under the program carry an interest rate of three percent per annum and are payable based on the maturity of the sub-promissory notes but not to exceed three years.

Institutions eligible under the lending facility include private junior and senior high schools with permits to operate from the Department of Education and private technical-vocational education training institutions regulated by the Technical Education and Skills Development Authority.

LandBank said private colleges and universities can also borrow if they offer undergraduate programs authorized by the Commission on Higher Education.

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