History of the Hungarian student loan system
In accordance with the provisions specified in the loan agreement made with the International Bank for Reconstruction and Development, the government of the Republic of Hungary introduced the student loan system under the Higher Education Development Programme.
The Hungarian system, established in 2001, adopted elements of several internationally acknowledged student loan systems, and adjusted them to the specific characteristics and demographics of the Hungarian education system. Based on past experience, the operation of the Hungarian student loan system is successful. Our research and the social feedback received confirm that the student loan system works well. The conceptual founding pillars of the student loan system have not changed since the introduction of the system in 2001.
Subsequent to a thorough preparatory period, the Student Loan Centre, designated to manage the student loan system, was established on 27 April 2001. The Ministry of Education is the founder of the company and exercises all proprietary rights. (In the rest of the year, the ownership structure was amended twice. Two state-owned banks, Postabank and Takarékpénztár Rt., and then Magyar Fejlesztési Bank Rt. (Hungarian Development Bank Plc.) acquired ownership and management rights.)
The provisions regulating the student loan system and Governmental Decree No. 119/2001 (VI. 30.) on the student loan system and the Student Loan Centre were adopted on 30 June 2001. The legal provisions provide details of the conditions related to the application for and utilisation of the student loan, the disbursement of the student loan and the activities of the organisations taking part in the operation of the loan system, as well as the duties of the Student Loan Centre responsible for the operation of the student loan system.
Applications could be submitted from 3 September 2001. The student loan application package was available in 2520 post offices. Optional monthly loan amounts were HUF 10.000, HUF 15.000 and HUF 21.000.
On the first disbursement day of the student loan, 15 October 2001, 33,466 students received loans for September and October. The loan amounts were disbursed from the Student Loan Centre to the Borrowers’ bank accounts held by Postabank and Takarékpénztár Rt. (The company, in the first half-year of its operation disbursed almost HUF 7.1 billion to more than 70,000 students. Upon the introduction of the system the source of the student loans was provided by the credit limit agreement made with the Hungarian Development Bank (HDB), which has been amended several times.
The legal provisions on the student loan system were amended, as a result of which, as of the spring semester of the 2001/2002 academic year, students could receive the student loan for a whole semester in one amount.
The Student Loan System reached 100,000 Borrowers during the first disbursement in the 2002/2003 academic year (in October).
In the autumn of 2002, the maximum amount of the student loan was increased from HUF 21,000 to 25,000.
In December 2002, the Hungarian government purchased all shares in the Student Loan Centre. In accordance with the property management agreement, at this time proprietary rights were exercised by the Ministry of Finance.
- Next >>