Factors Affecting Repayment Of Education Loan Among University Students In Kenya

Abstract

Higher Education Loans Board (HELB) is the major source of financing higher education in Kenya. Non-repayment of the loan among university students after they have graduated is a major drawback on funding education for other needy students. The total amount of loan available to the current students depends on repayments done by the past students. Non- recovery of loans leads to non-sustainability of the education fund which leads to a number of loan applicants unable to get the loans which are meant to assist them cater for their learning expenses. This study sought to find out the factors affecting repayment of higher education loan by university students in Kenya. The study will be guided by three objectives which will focus on how ability to pay, loan repayment policy and perception towards HELB loan affects repayment of Higher Education Loans. A review of related literature will be conducted, which comprises, background of student loan financing, loan default, success and failure of student loans schemes and other literature relating to issues on student loan financing. The study population will consist of 261,933 university graduates who are beneficiaries of higher education loans and their loans had matured by the year 2015. The study will employ a descriptive research design and random sampling technique will be used to develop the sample size. Collection of data will be done using structured questionnaires which will be given to the target respondents to fill in. Exploratory Factor analysis will be done using SPSS version 20 after which a Multivariate regression will be fitted on the data to determine the relationship between the dependent and independent variables.