Taipei, Jan. 5 (CNA) The Ministry of Education (MOE) said Friday that it has approved amendments to student loan regulations to make it easier for borrowers to pay back their debts.
The amendments, which apply to those studying at the high-school level or above, include widening the eligibility for interest-free loans and introducing more relaxed repayment measures, with both set to take effect in February, the MOE said in a statement.
The revisions stipulate that if a student comes from a household with an annual income of less than NT$1.2 million (US$38,732), they can apply for an interest-free loan, according to the MOE.
If a student loan applicant has a sibling who is either underaged or an adult student, or has a child who is either underaged or an adult student, the household income threshold rises to NT$1.48 million for the student to be entitled to an interest-free loan.
If a student has two or more siblings or two or more children, there are no household income requirements.
Under existing requirements, all students from families with an annual income of less than NT$1.14 million can apply for interest-free loans. Those from households with an annual income between NT$1.14 million and NT$1.2 million pay half the interest amount.
An only child belonging to a household with an income of more than NT$1.2 million is not currently eligible to apply for a student loan.
However, a student who is from a family with an annual income of over NT$1.2 million who also has siblings is eligible to apply for a student loan, but they have to repay the full amount of interest.
Regarding the more relaxed repayment measures, borrowers can get a 12-year deferment period if they earn less than NT$50,000 per month, up from an increase in the existing eight-year deferment period and NT$40,000 threshold, according to the MOE.
The income threshold increases to NT$60,000 a month if a borrower has a child, and by an additional NT$10,000 for each subsequent child.
The period of only having to pay back interest rather than the loan’s principal has also been extended to 12 years, the MOE said.
The MOE said the amendments were approved to reduce the burdens of students from economically disadvantaged backgrounds.
