From July 1, the agency loaning government funds to Swedish students, CSN (Centrala Studienämnden), will be allowed to collect the entire amount of outstanding debts - wherever the borrower lives in the world - whenever even the slightest payment infraction occurs.

In 2008, nearly 940,000 people had some form of student aid, mainly for study and student living allowances. As of last October, the total debt that is currently managed by CSN amounted to SEK 183 billion. According to CSN, bad debts included in this sum had mounted to more than $3.06 billion (SEK 24 billion).

Owned today by the government but formed as an independent organization, CSN reports that there are some 68,000 borrower who now live outside Sweden, and of these, around 30,000 have received reminders, collection notices or other warnings, but still mismanage their repayments.

Swedish students have taken loans for decades to study, mainly in college or university courses. Until now, CSN was not authorized to call in loans and demand immediate payment. In addition, in contrast to Sweden's social insurance and unemployment insurance operations, CSN was prevented from withholding payments during the period when a student's eligibility was under scrutiny.

"To continue providing a generous system, those who borrow must pay back," said Moderate MP Patrik Forslund during the debate that preceded the decision of Parliament to adopt the stricter regulations.

The Swedish Parliament also passed measures that allow CSN to withhold payments - or make partial payments - when a borrowing student is believed to have dropped out of school. Payment for studies abroad will be coordinated with the same regulations that are in place in the European Union, loans will be written off for persons who are caring for sick children or relatives for more than 30 days and the achieved results of a student's education will weigh more heavily when judgments are made regarding loans.

Sources: www.sviv.se, www.rod.se