The Vanuatu National Provident Fund (VNPF) has frozen its Student Education Support Scheme after disclosing that more than VT 2.6 billion in loans remain unpaid.

VNPF General Manager, Paul Kaun, confirmed the outstanding amount and said repayment levels from students have fallen well short of the Fund’s expectations.

“Unfortunately, this is a fund that has faced a lot of challenges,” Mr. Kaun said in an interview. “Our experience is that we did not expect this to happen. As a result, the Board has decided to freeze the scheme.”

The Student Education Support Scheme was introduced to assist students in pursuing tertiary studies, with the condition that loans be repaid within five years after graduation. However, VNPF says a significant number of students have failed to honour their repayment obligations.

Mr. Kaun stated that the scheme will remain suspended until there is a marked improvement in repayments by both students and their guarantors.

“In order for us to address this, we have to freeze any new applications until the time we see repayments reach a level that allows us to reopen the scheme. The Board will decide when that happens,” he added.

VNPF says the future of the scheme depends entirely on the commitment of borrowers to repay their loans. Until then, no new applications will be accepted.