education 23 June 2026 Daily Monitor (Uganda)
Student Loan Scheme Faces Significant Default Crisis: Over Half of Beneficiaries Not Repaying
The Higher Education Students’ Financing Board (HESFB) in Uganda is grappling with a significant default rate, with over 58 percent of student loan beneficiaries failing to repay their loans after graduation. This non-compliance threatens the sustainability of the scheme designed to support economically disadvantaged yet academically strong students. Source: https://www.monitor.co.ug/uganda/news/national/over-50-of-student-loan-scheme-beneficiaries-defaulting-govt-5505928
A concerning trend has emerged within Uganda’s government-sponsored student loan program, with reports indicating that a substantial majority of beneficiaries are not meeting their repayment obligations. According to Michael Wanyama, the Executive Director of the Higher Education Students’ Financing Board (HESFB), only 42 percent of those who received financial aid for their studies are currently complying with the repayment schedule.
Since its inception in 2014, the HESFB scheme has supported over 16,000 students, primarily focusing on undergraduate diploma and degree programs in Science, Technology, Engineering, and Mathematics (STEM), alongside select humanities courses. The program also provides support for students with disabilities across any field of study.
Beneficiaries are expected to commence loan repayment one year after completing their higher education. However, a substantial number are now falling into default, prompting the Ministry of Education and Sports to issue a stern reminder. Wanyama urged those who have completed their studies and are within the repayment period to either begin repaying or provide proof of lacking gainful employment.
The cost of the loan can be substantial, averaging Shs4.5 million per person per year, and in some cases rising to Shs7.6 million annually, depending on the chosen course. This financial commitment underscores the importance of timely repayment for the scheme’s continued operation.
The HESFB is projecting an increase in new beneficiaries for the upcoming academic years, with an additional Shs10 billion allocated to the scheme. Despite these efforts to expand access, the high default rate poses a significant challenge. Legal notices have been published, reminding defaulters of their obligations under the Higher Education Students’ Financing Act and the terms of their loan agreements. Failure to comply within six months could lead to the publication of names and further lawful recovery measures.