The Minister of Education, Haruna Iddrisu, has described the compound interest charged on student loans as unfair to unemployed graduates and said the government is reviewing the repayment structure to ease their financial burden.
Appearing before the Public Accounts Committee (PAC) on Monday, November 3, 2025, Mr Iddrisu said the Ministry of Education was considering changes to the interest rate policy of the Students Loan Trust Fund (SLTF) to move away from compound interest to a simpler model.
“We are thinking of reviewing the interest rate regime of the Student Loan Trust,” he told the Committee. “A student gets a loan, completes school, has no job, and you are compounding interest on the loan. Mathematically, what is the fairness in that? We may have to return to a simple interest regime, but without affecting the financial stability of those from whom the money originates.”
Mr Iddrisu explained that government’s intention was not to weaken the financial base of the SLTF but to make repayment terms fairer for graduates yet to find employment.
He said the proposed review formed part of broader efforts to strengthen social support programmes under the Mahama administration, including the No Fees Stress initiative and targeted bursaries for persons with disabilities.
Mr Iddrisu, who commended the impact of these interventions, said timely budgetary releases from the Ministry of Finance would be important to sustain them.
The Public Accounts Committee also reviewed the financial performance of the Students Loan Trust Fund, which continues to record deficits despite modest improvements in 2023.
