WASHINGTON -- The federal government's new college lending program will probably be inadequate to cover students' financing needs, forcing many state agencies to create their own bond-financed loan programs to pick up the slack, education lobbyists and state officials say.

Signed into law in August, the program requires the federal government to give colleges seed money to set up revolving loan funds. After a five-year trial period, Congress is expected to fully implement direct lending and kill off the old system of federally guaranteed bank loans to students.

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