Introduction
The government of Malawi has been providing loans to needy university students since 1985. Through the past years the students’ loans have been administered by University of Malawi Central Office, Ministry of Education Science and Technology (MoEST), Public University Loans Trust and Malawi Savings Bank. However, it was noted that all these institutions had challenges of effective disbursement mechanisms of loans to students and recovering the old loans from former beneficiaries due to the lack of regulatory legal framework and proper guiding mechanisms in the disbursement and recovery processes.
Mandate of HESLGB
To enhance the efficiency and effectiveness in loans disbursements and recoveries; the Government through the Higher Education Students Loans and Grants Board Act number 2 of 2015 established the Higher Education Students’ Loans and Grants Board (HESLGB). HESLGB was legally established with two core mandates, which are; to annually provide loans and grants to needy students who are pursuing higher education in accredited private and public institutions of higher learning and to recover all the outstanding loans from former beneficiaries of students’ loan schemes.
Loan Disbursement Calendar
In order to effectively and efficiently fulfil the disbursement mandate, HESLGB devised a loan disbursement calendar that annually guides the activities leading to the disbursement of loans to needy students. The first activity in the calendar is the distribution of the loan application forms and advertising on the same. HESLGB makes all the necessary efforts to ensure that the loan application forms are accessible to all interested applicants regardless of their location. As for the 2018/19 loans, application forms will be available at all the accredited institutions of Higher Learning, District Education Managers Office, District Commissioners Office, Secondary Schools, Faith based Education Departments, all National Initiative for Civic Education offices, and all national libraries.
Loan Application
This is followed by opening of the loan application window which runs for a full month. During this period applicants are required to submit complete loan application with all the necessary attached as requested on the loan application form. Continuing students are required to submit their loan application form through their university/college administrators while newly selected students are required to submit the application forms directly to the HESLGB secretariat through post or hand delivery. It is also within the same period that data for all applicants is entered and serialized into the HESLGB system.
Loan Screening
Upon closure of the application process, HESLGB will embark on a month long process of loans application screening. This involves scrutinizing each loan application to assess if the applicant meets the eligibility criteria. Each university/college is allocated specific days for proper screening of its applicants.
Loan Approval
At the end of the screening process a list of recommended applicants for each university/college is compiled and presented to the Loans and Grants Disbursement Committee of the HESLGB Board of Directors. The committee scrutinizes the recommended loan applicants and makes proposals to the main Board for approval. This is followed by deliberations of the proposals by the main Board which then provisionally approves and releases the provisionally approved list for that particular financial year.
Vetting Process
The provisionally approved list for each particular university/college is then vetted in collaboration with university/college administrators. This process is conducted in order to remove from the list students who: are found to be on scholarships, have withdrawn, are repeating or have disciplinary issues and other factors as stipulated in the HESLGB Act and policies. It is also at this point that additional needy students who might have been omitted in the previous screening processes are identified and included on the list.
Bonding Process
Upon completion of the vetting process a final loan beneficiaries list is then compiled and published. All students who appeal on the final loan list are required to accept the amount they have been offered by signing a contract (The Bonding Form) and Letter of Undertaking.
Disbursement Process
After the bonding process tuition loans are transferred directly to the university/college bank account whilst upkeep loans are paid directly into the students’ bank account. The disbursement is per the semester system basis.
Call to Action
It should be noted that HESLGB does not process and grant loans on a daily basis and that the loan calendar is strictly adhered to by all HESLGB staff member. Therefore, all parents, guardians, students (both continuing and newly selected) are required to follow the calendar in order to be to be granted loans.
Applicants are also advised to make sure that they submit a fully completed loan application form with all the necessary attachments as instructed on the loan application forms.