Unpacking the Modalities of Student Loan Recovery in Zambia: Evidence from Higher Education Loans and Scholarships Board

Abstract

This study explored the modalities employed by the Higher Education Loans and Scholarships Board (HELSB) to recover student loans in Zambia guided by the Human Capital Theory. A case study research design was adopted, with respondents selected through expert purposive sampling. The study involved one Ministry of Education official and seven HELSB staff members. Data were collected using interview guides designed to capture both qualitative and quantitative information, with qualitative data analyzed thematically. Findings revealed that HELSB recovers loans primarily by retrieving beneficiary records from NAPSA and ZRA databases and by leveraging payroll systems, including the Public Service Management Division (PSMD) and individual or private employers. Based on the findings, the following recommendations were made: HELSB needs to insure the loans because loan insurance considerably reduces the educational debt's financial risk. In order to guarantee that these requirements are laid out explicitly in the agreement deed, HELSB must make sure that borrowers are well-informed about their obligations to repay their loans at the time of application. To aid in the tracing down of beneficiaries whose loans have matured, HELSB needs to establish closer relationships with higher educational institutions, student organisations/unions, and alumni networks. They should also work more closely with employing agencies and employers to ensure timely repayment and recovery of loans. In an effort to increase the employers' compliance levels, HELSB management ought to devote additional resources to leading compliance visits.