China plans to blacklist students who fail to pay off their
interest-free loans, in a bid to ensure sound operation and lower
risk for the state education loan system, the Ministry of Education
(MOE) said in
Beijing on Tuesday.
Cui Bangyan, the Ministry's senior official in charge of the
loan management, said that information including the name, ID
number and the alma mater of students who fail to redeem loan
payment for six years will be publicized in various media and
websites.
China introduced a pilot state education loan system in 1999,
which was extended to the rest of the country in 2004, in eight
major cities, including Beijing, Shanghai and
Tianjin, to assist college students from needy families.
"The time has come for early applicants to repay their loans,"
Cui said.
According to a survey conducted by the Ministry, nearly 20
percent of prospective borrowers fail to pay back loans in various
ways, indicating that the risks inherent in the state loan system
have revealed themselves.
"The risks are intensified by the increasingly difficult job
hunting, the high mobility of modern labor, and low awareness of
the merit of credit among some students in China," Cui said.
According to documents issued by the central government, for
students who have a default in payment, loan interest will be
levied, the default will be recorded on the credit information
system, and the student will not be given loans or credit services
in the future.
The People's Bank of China (PBC), the nation's
central bank, announced earlier this year that a personal credit
information system that connects all local commercial banks and
some rural credit cooperatives was formally established in
China.
China's state loan system issued 17.27 billion yuan (about
US$2.08 billion) in interest-free loans to 2.068 million college
students from poor families by the end of 2005.
(Xinhua News Agency March 8, 2006)