Interest-free student loans

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Name of the instrument - Local language
Άτοκα φοιτητικά δάνεια
Name of the instrument - English translation
Interest-free student loans
Scheme ID
74
Country
Greece
Reporting year
2020
Type of instrument
Loan
Sub-type of instrument
Loan for HE expanded to adults
Type of entry
Single instrument
Short description

Undergraduate students have the right to receive an interest-free student loan from credit institutions of the Greek State. The eligibility criteria for receiving the loan include the academic performance of the student and their personal or family socioeconomic conditions. There is no age limit, nor are there specific rules applicable to all higher education institutions. Higher education institutions are autonomous and each university or even department within universities can decide if and how to implement aspects of it. In addition, an earlier law (Law 2413/1996) foresees that Greek students subscribed to post-graduate and doctoral studies in Greek Universities have the right to interest-free student loans. However, none of the legislation has been implemented in practice. A more recent law (Law 4701/2020) which foresees "easy loans" of up to EUR 25 000 for a range of target groups, including students, has not been implemented yet either.

Level of operation
National
Name of a part of the country
Not applicable
Name of the region (for regional instruments)
Not applicable
Name of the sector (for sectoral instruments)
Not applicable
Relevance
Key instrument
Law 4009/2011 on Higher Education and Law 2146/2013 law on Restructuring of Secondary Education
Objective(s) and target(s)
To offer economic support to students facing economic difficulties (Article 54, Law 4009/2011). However, this was never implemented. There is now a new Law (4701/2020) that stipulates the provision of "easy loans" (microfinance) to a range of target groups including inter alia natural persons who want support to cover the costs of their education, training or apprenticeship.
Year of implementation
2011
Year of latest amendment
4009
Operation/management
Law 4009/2011 (Article 54) foresees that undergraduates and postgraduate students have the right to receive a student loan from credit institutions of the country, with the guarantee of the Greek State. In reality, this provision in the Law was never made operational. Recently (2020), the government has announced the provision of "easy loans" of up to 25.000 euro for a range of target groups including students (small entrepreneurs, potential entrepreneurs, unemployed, disadvantaged groups and students). For undergraduate and post-graduate students, this envisages loans according to the model of student loans provided in many foreign countries. It remains to be seen if it will be implemented.
Eligible group(s)
Undergraduate and graduate students so that they complete their studies.
Group(s) with preferential treatment
Targets more vulnerable students: the conditions for granting the loan to students, will depend on the academic performance of the student, as well as their social and financial situation and that of their family.
Education and training eligible
Does not specify, but covers undergraduate and post-graduate students.
Source of financing and collection mechanism
Greek credit institutions will offer the loans, covered by Greek state with the guarantee of the Greek state. There are several Greek banks that offer student loans with favourable terms and conditions but these are not interest free loans.
Financing formula and allocation mechanisms
Interest-free student loans are stipulated in the Greek legislation but they have not yet been implemented.
Eligible costs
Interest-free student loans are stipulated in the Greek legislation but they have not yet been implemented.
Volumes of funding
Interest-free student loans are stipiulated in the Greek legislation but they have not yet been implemented.
Beneficiaries/take up
Interest-free student loans are stipiulated in the Greek legislation but they have not yet been implemented.
Organisation responsible for monitoring/evaluation
Ministry of Education and Ministry of Economy
Most relevant webpage - in English
Not available
Most relevant webpage - local language
https://www.e-nomothesia.gr/kat-ekpaideuse/tritobathmia-ekpaideuse/n-40…
Recent changes

Not an amendment of Law 4009/2001, but a new Law published in June 2020, on "Microfinance framework, financial sector arrangements and other provisions", which foresees that microfinance beneficiaries include inter alia "natural persons to cover expenses directly or indirectly related to their education or training or apprenticeship" (Article 15). Rationale for the new Law is the provision of microfinance support for the most vulnerable.

Recent changes in response to COVID-19

Possibly, the effort to offer "easy loans" in this period is also related to the effects of Covid, i.e. trying to mitigate these effects.

Sources
Law 4009/2011 on Higher Education and Law 2146/2013 law on Restructuring of Secondary Education
Law 4701/2020 on Microfinance framework, financial sector arrangements and other provisions
https://www.sofokleousin.gr/eykola-daneia-mexri-25000-eyro-se-mikrous-k…
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