Effectiveness of higher education students' loans repayment processes in Tanzania

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University of Dar es Salaam
The study aimed examining the effectiveness of higher education students’ loans repayment process in Tanzania. To affairs that aim the study was guided by three research tasks. Firstly, to examine the trend of loans repayment by all past beneficiaries repaid in the period between July 2006 and September 2007, secondly to explore the methods used in collecting loans and thirdly to suggest the effective alternative methods of collecting loans among the past beneficiaries according to the problems accoutered. The criterial for effectiveness were, increased identifications of past loaners, increased loans repayment collection lower administration coasts than the amount collected over the same period and finally is the ability to disburse funds out of the repaid loans. The sample data for this study was collected from respondents composed of sixty four loans beneficiaries’ senior loans board officials, UDSM undergraduate and postgraduate students, employers and employees from MoEVT. Using case study design, the methodological procedures used to collect data draw on quantitative and qualitative approaches. To ensure the authenticity of the data, three methods of data collection were used questionnaire, documentary search and interviews. All the instruments were checked, tested and corrected to ensure validity and reliability. The collected data were analyzed and presented according to the nature of the data. The study findings are as follows, firstly, loan repayment among the past loaners was not good due to low rate of identifying them (4 percent in fourteen months). Secondly, the process of loan repayment was encountered by various problems including difficulties in tracing the loaners due to incomplete building up of database, crude form of data processing (mostly, manually) and higher administrative costs. Thirdly, loan borrowers repaid their loans in nominal terms graduated into 120 instruments and the borrower was not required to pay back the full value of the loan. The received fourthly, the capital flow from the government will continually be increasing overtime due to low rate of loan repayments, loan repayments without interest charges (zero increate charges) and very long period. The study recommended that for effective loan repayment and collection the board should go for a computerized data processing system and involvement of more financial institution in tracing loaners and collect loan repayments as alternative methods that would help to improve loan collection. The other equally effective alternative is to outsource the activities of loan repayment collection to a specialized agent.
Available in print form, East Africana Collection, Dr. Wilbert Chagula Library, Class Mark (THS EAF LB2340.4.T34N3756)
Higher education students loans, Loans repayment processes, Student loan funds
Ndomba, A. M (2009) Effectiveness of higher education students' loans repayment processes in Tanzania, Master dissertation, University of Dar es Salaam