In a March 2018 speech, President Joko Widodo challenged banks to implement educational loans for higher education, better known as student loans. President Jokowi made this statement not without basis. This reflects the recent societal conditions, namely the low absorption rate of high school graduates and equivalents who continue their studies at university. Of course, this is very concerning considering that competition is no longer just within Indonesia but has also reached international levels, such as the ASEAN Economic Community (AEC). On the other hand, credit absorption in Indonesia is also still relatively low. President Jokowi also stated that in several developed and developing countries, the student loan system has been successfully implemented despite still facing obstacles. For various reasons, President Jokowi wants a credit system that can alleviate these various problems. The president's challenge was welcomed by national banks. Within a few weeks, Bank Tabungan Negara (BTN) launched educational loans for students from undergraduate to doctoral level, and Bank Rakyat Indonesia (BRI) launched loans for master's and doctoral students with several conditions.
In 1980, Indonesia actually implemented an educational credit program, better known as KMI (Indonesian Student Credit). However, this program failed because the requirement to obtain a diploma for creditors was to be able to repay their educational credit. However, in reality, to get a job, students only needed a photocopy of a legalized diploma, eliminating the need for an original diploma. This resulted in creditors/students not repaying their educational credit installments. Based on this experience, according to financial planners, an assessment after graduation, and educational credit should be prioritized for students who want to continue to Masters and Doctoral degrees who already have jobs. While for undergraduate students, more filtering is needed in the form of collateral from parents, and implementing the 5Cs of banking (Capital, character, capability, condition, and collateral) to reduce the risk of credit default.
From a Sharia banking perspective, we believe student loans are not yet feasible First, the imposition of interest is clearly contrary to Sharia principles. Second, because Sharia banks, as business entities, naturally require a profitable scheme, and the Qard al-Hasan is not one that can generate profit. Sharia banks, on the other hand, can only enter into contracts for indirect loans with a clear profit-sharing agreement ( Ujrah) . Therefore, Sharia banks may still be unable to contribute to the challenges posed by our president.
Reflecting on the various causes and impacts of student loans, this discussion offers another alternative to student loans : productive educational waqf. The scheme of productive educational waqf itself, namely waqf managed by the Indonesian Waqf Board (BWI) and distributed to anyone in need through two ways: scholarships or loans through the qordul hasan (a loan of virtue, namely a loan that if the borrower is unable to repay, it is okay or is forgiven). Productive educational waqf can also be implemented by universities. A percentage of the Single Tuition Fee (UKT) is set aside by the university to be donated as a productive waqf. The university waqf is managed by the university itself so that transparency and its use are controlled. Waqf funds can be used to conduct various halal businesses so as to generate profits where the principal waqf cannot decrease in value and the profits from waqf management are used for scholarships or educational loans for students of related universities under the same scheme as before.
This solution is considered more capable of addressing the educational problems conveyed by President Joko Widodo, and this program has been implemented and succeeded in several institutions including the Darussalam Gontor Ponorogo Modern Islamic Boarding School and the International Islamic University Malaysia and is more in accordance with Islamic Sharia.
Despite the various pros and cons of student loans, everyone hopes that education in Indonesia will improve, whether through student loans or other means that will positively impact the quality of our human resources, thereby creating a much better national economy. As students, what we can do is continue studying diligently according to our chosen programs and remain critical and wise in facing the various challenges facing society in the future.
Author: Science ACSES FEB UNAIR 2018
Work Program: AcSES Iqtishoduna Discussion
Moderator: Sigit Awwaludin