An Analysis Of Loan Repayment Behaviour Among Students Loan Borrowers In Ghana

ABSTRACT The sustainability of the Student Loan Scheme in Ghana has been the downside of its operations since it was first introduced in 1971. The one major determinant of a successfully scheme is its ability to recover loans disbursed. In recent times, numerous government initiatives have resulted in the decline of government support to the scheme managers of the Students Loan Trust Fund (SLTF). This has called for appropriate strategizing of recovery activities by the scheme Managers in order to remain sustainable and relevant. The study depended on both primary and secondary data to examine its objectives. The key objective of the study is to examine what influences the repayment behaviour among students’ loan borrowers, using data from SLTF comprising of borrowers whose loans are due from 2008 to 2018. Primary data was also collected via telephone interview to try to establish the relationship between the knowledge of loan agreement and loan repayment. The study used SPSS to present a descriptive analysis to examine the influence of gender, programme of study and knowledge of loan agreement, in addition to other secondary independent variables such as parental employment status and educational level, also the respondents and employment status. The study’s findings suggests that more males enrol in tertiary institutions than females, and as a result the analysis proved that more males made repayment than females. The study further finds that the higher the occupational level of borrowers after graduation the higher the rate of repayment. Borrowers were found to have knowledge about the loan agreement however, it was continued reminders that influence repayment behaviours. The study suggests that fund managers together with policy makers must strategize their reminders to borrowers in order to eliminate the lag in repayment and ensure sustainability.