Rwanda : Students Loan recovery facing challenges

Students Loan recovery

The Loan Payment and Recovery Unit in Rwanda Education Board (REB) is currently facing challenges of meeting its targets of recovering at least Rwf18 billion by the end of 2015, due to lack of legal structures.

The institutions’ Acting Director, Esther Mukasine Ndagije says that lack of a legal instrument and inadequate human resources continue to derail efforts to recover loans that are advanced to students for further studies.

The said students’ loans are handed in form of grants from the government to students in higher institutions of learning, which they are supposed to reimburse after graduation and acquiring employments.

The repayment of loans is done mainly through deduction of 8 per cent of the gross salary of employees on a monthly basis and deductions are deposited on recovery accounts, however ever since the program started in 2008, only  Rwf4.5 billion out of Rwf70 billion has been recovered.

The acting director says that this setback in recovering the funds is because there is no law which could enforce and determine penalties to the employers who refuse to make deductions and declarations on their employees who benefited from the government’s academic loan.

However, Mukasine says that despite employers and former benefactor of the grants resistance among the challenges, some few individuals have voluntarily approached the unit and started repaying their loans though the majority of recipients are still silent.

REB statistics indicate that so far 329 employers have been contacted in a bid to trace the loan beneficiaries and that, by end of April, this year; only 8,146 beneficiaries had already been contacted.

As part of cosmetic measures to this problem Mukasine revealed that apparently, the grant unit is planning to make regular visits to organizations where the beneficiaries are employed to sensitize them on the need to honour their obligations.

The Unit has also recommended the need to decentralize the loan recovery process, saying that the procedure is currently complicated by lack of human resource to cover all institutions where former beneficiaries are employed.

 

 

 

 

 

One Response to Rwanda : Students Loan recovery facing challenges

  1. The state must severe decisions for them if not the current student will undergo this case.For ex in 2011,and in 2012 they get225000 and 175000 respectively instead of getting 250000 as in the recent years

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