Debt stricken teachers now get reprieve of their debt burden

Debt stricken teachers are now seeing some relief of their debt burden after the government has given instruction to the state-owned Government Savings Bank to help them.

The government considers teaching profession to be one of the groups that have the highest amount of outstanding debts.

Following the instruction, the Government Savings Bank (GSB) has now come up with measures to alleviate teacher’s debts.

The bank now allows indebted teachers to register for eligibility until the end of July.

Under the GSB debt moratorium scheme, it classifies teacher’s debts into four groups.

The first group are teachers being sued by banks or who had their properties seized by courts. This group is considered the most critical and the GSB will allow a leniency period by giving an interest payment break up to 3 years. They are however required to repay the overdue interest and principal when the period expires.

The second group are teachers who have defaulted on loans for 12 consecutive months and in accordance with the new measures will have their interests payments slashed by half for a period of 2 years but following that, will have to repay the principal plus the remaining interest.

The third group are those who have defaulted on loans not exceeding a period of 12 months and the GSB will help them by implementing debt restructuring.

The final group are regular loan applicants who will be given a leniency period for principal repayment for 2 years but are required to pay monthly interest payments.

GSB president and CEO Chatchai Phayuhanaveechai stated that applicants must register with all GSB branches across the country from now until July 31 and must provide consent from their guarantors.

Furthermore, they must allow the Comptroller Department to deduct payments from their salaries and agree not to incur new debts with the Savings and Credit Cooperative.

He said at present there are an estimated 500,000 teachers with outstanding debts with the GSB throughout the country and of these, more than 1,000 are classified as critical cases under the first group.