The Student Loan Center closed a record year with 42,000 new applications, three times the 2019 figure, according to leading Hungarian business daily newspaper, Világgazdaság.
For the first time, the amount disbursed in student loans exceeded HUF 30 billion (around 80 million Euros).
Péter Magyar, the CEO of the Student Loan center, believes
The labor market difficulties caused by the coronavirus epidemic also played a role in the fact that students applied for the maximum loan at a significantly higher rate, 80 percent, than in previous years.”
Large demand can also be explained by the fact that from August 2020, the government decided to increase the maximum monthly amount of free-to-use student loans, from HUF 70,000 (195 Euro) to HUF 150,000 (420 Euro).
A significant portion of the new contracts, more than two-thirds, are a free-to-use, interest-free Student Loan Plus product. Almost all new contractors (98 percent) requested the maximum loan of HUF half a million (around 1400 Euros) with a five-year repayment, which is the longest available plan.
Péter Magyar expects another peak this year following the introduction of vocational and course training loans. These loans can be applied for completely online at the Student Loan Center from May 31st. The interest-free Training Loan 2, like the Student Loan 2, covers all training costs. The Training Loan 1 will be free to use, with an interest rate of 1.99 percent, and a maximum monthly amount of HUF 150,000. This will be of great help to those who have so far been unable to learn a new profession or participate in course education for financial reasons.
Featured photo illustration by Tibor Oláh/MTVA