Finns running up student-loan debt at unprecedented pace

Finnish university students are running up student-loan debt at an unprecedented rate, according to the Bank of Finland.

Finnish university students are running up student-loan debt at an unprecedented pace - writes helsinkitimes.fi.

The Bank of Finland on Monday reported that the outstanding student-loan burden has crept up to a historically high level of 2.7 billion euros, marking only the second time the debt burden has breached the two-billion-euro mark.

Markus Aaltonen, an economist at the Bank of Finland, tells in a blog post that the student-loan debt portfolio peaked at 2.1 billion euros in the midst of the recession of the 1990s, an amount that – when converted to today’s money – is slightly larger than the current one.If the loan portfolio continued to grow at the current pace, it would hit three billion euros by the end of 2018 and four billion euros in the early 2020s.

Aaltonen estimates that the primary reason for the mounting student-loan burden is the recent decision to raise the government guarantees for student loans.

The Finnish government introduced changes to the student financial aid systemin August. Students in higher education institutions have since then been able to borrow 650 euros – instead of 400 euros – a month in student loan and consequently run up more than 30,000 euros in debt before completing their studies.

“The previous time the government guarantees were raised, the pace picked up notably also in the months following the raise. As this raise is considerably bigger than the one before, the growth may pick up pace in the future,” predicts Aaltonen.

The Bank of Finland revealed that students in higher education institutions took out a total of 143 million euros in student loans in August – more than two times as much as in August, 2016.

Aleksi Teivainen – HT

Photo: Markku Ulander – Lehtikuva

Source: Uusi Suomi

Read more news of Helsinki on our site.

helsinkitimes.fi
Finns student-loan education students
If you notice an error, highlight the text you want and press Ctrl + Enter to report it to the editor
2 views in november
I recommend
No recommendations yet

Comments

Post your comment to communicate and discuss this article.

Society
A citizens initiative demanding the end of diesel tax met its target for 50,000 signatures in just one day, six months ahead of schedule. Cities across the world might be looking for ways to reduce the use of harmful diesel engines, but in Finland there appears to be a groundswell of popular support for the dirty fuel. On Monday Tuulikki Paavola published a citizens initiative demanding an end to Finland’s diesel tax was published, with the goal of getting...
Society
The winners of the first edition of the European Capital of Smart Tourism competition were awarded 7th of November at a ceremony in Brussels, on the occasion of the European Tourism Day. The title for 2019 was awarded to two cities: Helsinki and Lyon. Cities of more than 100.000 inhabitants were eligible in the first edition of this competition. 38 cities from 19 EU Member States applied, but Helsinki and Lyon stood out for their innovative tourism measure...
Society
Alexander Stubb (NCP), a vice-president at the European Investment Bank (EIB), has hinted at the possibility of returning to politics after losing the race to become the lead candidate of the European People’s Party (EPP) to Manfred Weber of Germany. Stubb received more votes than expected but lost to his rival candidate by a clear vote of 127 to 492 at EPP Congress Helsinki on Thursday. “I got a very good feeling [from the campaign], I must admit,” the fo...
Politics
The Finnish government will introduce no amendments to legislation on patient data during this electoral term, assures Annika Saarikko, the Minister of Family Affairs and Social Services. Saarikko and Kai Mykkänen (NCP), the Minister of the Interior, have participated actively in public debate concerning a legislative proposal that, according to Helsingin Sanomat, has been drafted in secrecy and would grant police significantly wider access to sensitive pa...
Society
School groups could in the future use public transport services in the Helsinki region free of charge when travelling with a teacher, according to a decision made by the Executive Board of Helsinki Region Transport (HSL) on 30 October 2018. The final decision on transport charges, including tickets for school groups, will be made by the HSL General Meeting on 27 November.  From the beginning of 2019 onwards, municipal school administrations would no longer...
Society
Finland has dropped to eighth in the world in the latest version of a ranking of countries according to their English language skills. Finns are now the worst English-speakers in the Nordic countries, according to the EF English Proficiency Index. The 2018 version of the ranking puts Finland in eighth spot, with western neighbour Sweden topping the comparison. This year’s result is the weakest Finland has achieved in the ranking, which has been published e...
Society
The theme of next month's Independence Day ball at Helsinki's Presidential Palace will be climate change and environmental issues. The theme of this year's Independence Day reception will be climate change and the environment, according to the Office of the President of the Republic. Finland's most exclusive social occasion is just one month away, and the Office of the President has started sending invitations to some 1,700 guests for an evening that tradi...
Society
The day's papers report on unsolved thefts, free head lice medicine for families and Angela Merkel's visit to Helsinki. Daily Helsingin Sanomat reports that most larcenies go unsolved in Finland. According to statistics by the Police University College, police were able to clear 3,150 offences between January and September of this year, while about 41,500 remain unsolved. In 80 smaller municipalities, especially in Lapland and Åland, the police did not sol...
Society
Finland's Tax Administration reports that 15,000 more eligible taxpayers declared no taxable income in the last two years, putting the total past 160,000 in 2017. https://yle.fi/uutiset/osasto/news/steady_increase_in_declarations_of_no_taxable_income/10492154 The number of eligible taxpayers who reported no taxable income in Finland has risen by 15,000 in the last two years to a total of 161,000 in 2017. "Most of the people declaring no taxable income are...