Press Release

National Student Loan Clearinghouse and the U.S. Department of Education, Office of Student Financial Assistance, Partner to Conduct Pilot Project

Cost-Benefit Enrollment Database Tested

HERNDON, VA, October 14, 1999 - The National Student Loan Clearinghouse is participating in a pilot project with the Office of Student Financial Assistance of the U.S. Department of Education to test the feasibility and cost-benefit of using the Clearinghouse's "all-enrolled database" for helping track enrollment changes among Direct Loan borrowers. The three-month pilot, which began in September, explores a process for exchanging enrollment information between the entities.

"The Clearinghouse has effectively and efficiently facilitated the exchange of student data among multiple business partners for the past six years," said Daniel Boehmer, President, National Student Loan Clearinghouse. "Our partnership with the Department is an important step toward bringing time-tested, private-sector solutions to government entities."

The database being tested reduces the use of paper deferment forms for students attending schools that use the Clearinghouse. The number of deferment forms is expected to drop significantly, reducing processing costs and creating a simplified system for students and schools.

The database also allows the Clearinghouse to notify SFA when a borrower withdraws from enrollment or drops below half-time status in an average of 30 days, compared to the current process that can take as long as 90 days. This can help reduce delinquency rates by converting borrowers to repayment status more quickly.

"We are maintaining the promise made in the Modernization Blueprint, which pledges our commitment to improving enrollment tracking for Direct Loan borrowers," said Dan Hayward, Division Director, SFA.

The National Student Loan Clearinghouse was launched in 1993 by a cross-section of student loan industry representatives to improve student loan services for all participants - colleges and universities, guaranty agencies, lenders and servicers, and the federal government. Since its inception, the Clearinghouse has reduced the workload for participating colleges and universities by hundreds of staff equivalents.

Press Inquiries:
Kathleen Dugan
Marketing Director
703-742-4208
dugan@studentclearinghouse.org