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V. Foreign Higher Education and Education Systems, International Relations, Bilateral Relations
B. Essays, Commentaries, Statements
Author BERLINGER, Edina
Title An efficient student loan system : case study of Hungary
Publication year 2009
Source/Footnote In: Higher education in Europe. - 34 (2009) 2, S. 257 - 267
Inventory number 26683
Keywords Ausland : Ungarn : Studenten, Studium, Lehre ; Studiengebühren ; Studentenschaft : soziale Lage
Abstract The Hungarian student loan system was introduced in 2001. It has four main attributes: universal access and universal conditions; income contingent repayment; private funding; and self-sustaining (zero-profit) operation without direct state subsidy. This latter characteristic makes the scheme quite unique in international practice. Empirical facts support the original idea: default rate is relatively low (1-2 per cent), administration costs per year are around 1 per cent of the portfolio value. This paper focuses on three issues: how the Hungarian model works; why a 'specialized institution' model is superior to a 'retail bank' model; and finally, why adverse selection is not as menacing as the literature may suggest. (HRK / Abstract übernommen)