By Alithea De Jesus
Aware of the problems of many students face in the height increasing unemployment rate caused by the pandemic, the Land Bank of the Philippines (LANDBANK) has thus far extended loans amounting to P500 million as of October 27 this year to 12 educational institutions to assist them in implementing their respective “study now, pay later” plans for students amid the economic shock triggered by the coronavirus pandemic.
As of October 27, LANDBANK is still awaiting the completion of the necessary documents for the processing of applications of 12 other schools under the institution’s Access to Academic Development to Empower the Masses towards Endless Opportunities (ACADEME) lending program, according to LANDBANK president-CEO Cecilia Borromeo.
In her report to Finance Secretary and LANDBANK board chairman Carlos Dominguez III, Borromeo also said that 14 other schools still need to submit their loan requirements to qualify for the program.
The outstanding balance under the ACADEME program is at P8.805 million, Borromeo said.
“Lending units nationwide continue to work closely with applicant-schools to complete their requirements as we process a pipeline of loan applications with approvals at various levels based on the amount,” said Borromeo in her report.
Borromeo said LANDBANK is continuing to offer ACADEME along with its Interim Students’ Loan for Tuition towards Upliftment of Education for the Development of the Youth (I-STUDY) direct lending program that aims to provide financial assistance to parents, guardians, or benefactors to enable them to send their students to schools.
I-STUDY which is a direct lending program to parents, guardians, or benefactors for the education of their children, will also assist private schools and downstream industries to sustain and continue their operations, she added.
“The Bank will continue to promote these two lending programs as a vital contribution of the Bank in assisting students and the schools under the Bayanihan II Law (Republic Act 11494),” Borromeo said.
The P3 billion ACADEME program was launched by LANDBANK in May to extend 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.
These promissory notes will then be refinanced or rediscounted under the program, with schools allowed to borrow as much as 70 percent of the sub-promissory note per semester and subject.
However, schools can only borrow up to a certain maximum amount based on the net borrowing capacity of the institution.
The lending program is available until June 30, 2021.
Borromeo said that on top of those who have yet to complete or submit their requirements, another 29 schools across the country have likewise expressed interest in availing of the ACADEME facility, Borromeo said.
“Lending units continue to monitor the eligibility of these schools through regular calls and visits,” she said.
Loans under the ACADEME program carry an interest rate of 3 percent per annum and are payable based on the maturity of the sub-promissory notes but not to exceed 3 years.
According to LANDBANK, institutions eligible under the ACADEME program include private junior and senior high schools with permits to operate from the Department of Education (DepEd) and private technical-vocational education training institutions regulated by the Technical Education and Skills Development Authority (TESDA).
LANDBANK said private colleges and universities can also avail of the program if they offer undergraduate programs authorized by the Commission on Higher Education (CHED).