Thailand Faces Student Loan Fund Crisis as Tens of Thousands at Risk
Thailand's Education Loan Fund faces a cash crisis affecting tens of thousands of students, prompting Pheu Thai party leaders to urge the government to inject 7 billion baht to cover budget shortages and prevent universities from banning ex
Pheu Thai party leaders, led by Natthapon Rueangpanya and deputy leader Sirikanya Tansakul, urged the government on September 21, 2024, to inject 7 billion baht into the Education Loan Fund (Krosueb) to prevent a crisis affecting tens of thousands of students. The fund is facing acute cash shortages in both fiscal years 2569 and 2570 because the next year's budget allocation is insufficient. A major factor is that former borrowers are not repaying loans, which is understandable given many came from low-income families. The party emphasized that Krosueb was never meant to be self-sustaining and that the government should have anticipated these funding gaps.
Two key structural issues prevent the fund from being self-reliant: First, the 2566 amendments to the Education Loan Fund Law reduced interest rates, cutting fund revenue and requiring partial refunds to borrowers, which also weakened loan discipline. Second, declining government contributions to the fund coincide with the start of the university semester, forcing universities to threaten students with exam bans if the fund fails to pay the institutions.
Rakchonok Srinok, a list-based Pheu Thai MP and former borrower herself, spoke emotionally about the human cost. "I am unsure if our ministers truly understand these struggles or the circumstances borrowers face, but I do—I borrowed from this fund because my family was poor," she said. She stressed that the 7 billion baht shortfall represents the livelihoods of parents and the futures of children who will be denied loans, dropping out of education and losing economic opportunity. She warned that recovering students after they leave the system will cost far more than filling the gap now.
Rakchonok challenged Finance Minister Ekniti Nitithanphaichap, noting that despite the fund's problems, he has never publicly addressed Krosueb since taking office. She pointed out that as chair of the 2570 budget committee, he approved 11,600 million baht in cuts without allocating a single baht to Krosueb, despite proposals from both government and opposition members to do so.
