Sustaining Higher Education In Ghana: The Role Of The Students Loan Scheme

ABSTRACT 

Higher education plays an important role in reducing poverty, inequality and facilitating sustainable economic growth and development. However, despite its relevance to national development, it comes with an enormous expenditure and challenges that most governments in both developed and developing countries continuously attempt to resolve. Students loan as a form of cost sharing element and funding mechanism has been introduced in most countries such as Australia, Kenya, Uganda and Ghana to address the various challenges such as increasing demand and financing for higher education. Monetary barriers, such as low family income, that impede access to higher education is now being removed by these students’ loan schemes. The main objective of this study is to examine the extent to which students’ loan scheme in Ghana has enabled tertiary students meet their financial needs in the course of their studies and the financial sustainability of the scheme. A multi sampling technique was used to select 382 respondents from UDS and Wa Polytechnic in the Wa Municipality. Logistic regression, descriptive statistics and Kendall’s coefficient of concordance test were the methods used for the analysis. Findings from the study revealed that duration of study, programme of study, fee status and fee payment status are the factors influencing students’ awareness of financial assistance. Besides, age, type of institution, fee payment status, ease of access to financial assistance and timely disbursement of loans were identified as determinants of access to financial assistance. Increasing educational expenses was the most motivational factor influencing students to enrol on the student loan scheme. One of the main challenges that respondents identified with accessing the students loan is the complex loan application requirements such as the difficulty in obtaining an eligible guarantor to guarantee the loan. The study recommends, among others, that stakeholders and management of the Trust Fund interested in improving students’ awareness and access to financial assistance should consider the identified factors in its decision making and also resolve identified challenges associated with the loan application processes in order for the scheme to be relevant to the needs of the tertiary students. It was also suggested that, managers of the scheme should explore alternative sources of funding to cater for its administrative costs as well as meet the financial needs of borrowers. A call has also been made that effective recovery systems should be put in place to reduce loan default and recover the loans in time in order for the scheme to be self-financing and sustainable.