Uganda: Govt Hunts Pupil Mortgage Defaulters at Work Locations

6 mins read

The federal government has finalised preparations to trace beneficiaries of its pupil mortgage scheme at their jobs to recuperate the cash.

Extremely-placed sources say the federal government has put in place a purpose-built digital platform the place employers might be required to log in to determine whether or not their new hires took a examine mortgage or not.

If beneficiaries, the employer might be obliged to deduct no more than 30 % of the worker’s internet month-to-month wage and remit the cash to Increased Schooling College students Financing Board (HESFB), in accordance with its spokesperson, Mr Bob Nuwagira.

“An employer who knowingly does not notify the board of the employment of an individual who has acquired a pupil mortgage, commits an offence and is liable, on conviction, to a high-quality not exceeding 2 hundred and forty forex factors (Shs4.8m), or imprisonment not exceeding ten years, or each,” he added.

This newspaper understands that HESFB targets to recuperate Shs32b over the subsequent six to 12 years from 3,090 college students who’ve graduated out of the overall 11,187 beneficiaries since 2014.

Among the many takers of the examine mortgage is Ms Gloria Namboira, who graduated from Kyambogo College with a diploma in Bio-Medical Engineering.

She stated she helps the monitoring of beneficiaries to their locations of labor.

“These individuals [government] have been there for us in exhausting occasions once we had been unable to pay tuition for ourselves. So, deducting a certain quantity from our salaries is just not unhealthy as a result of we now have to repay the mortgage,” Ms Namboira stated.

Though she continues to be jobless, Ms Namboira stated she would begin repaying the mortgage from any freelance work.

Mr Nuwagira stated they’ve recovered Shs400 million and 25 college students have absolutely repaid their loans, even earlier than the due date.

The Financing Board, in accordance with authorities officers, will write to employers in each the private and non-private sector to adjust to the event.

The choice follows many mortgage beneficiaries getting employed after their research, however declining to refund the cash.

This implies college students who studied on authorities loans will, along with Pay As You Earn (PAYE), the 5 % Nationwide Social Safety Fund (NSSF), and Native Service tax deductions, additionally give up up a part of their month-to-month wage to clear the mortgage.

The Increased Schooling College students Financing Board was established in 2014 to supply loans and scholarships to Ugandan college students who’ve certified to pursue accredited programmes within the recognised establishments of upper studying, however are financially unable.

Mr Nuwagira stated some beneficiaries have begun repaying the loans even when they’re nonetheless in class.

“The mother and father assist this class in repaying small quantities such that by the point they end faculty, their mortgage portfolio is small. Any monies paid in earlier than the top of the grace interval doesn’t entice curiosity,” he stated.

The utmost compensation interval is twice the examine interval along with the grace interval of 1 yr. This implies a pupil who research for a course of 4 years has 9 years to reimburse the examine mortgage.

The Financing Board may also reschedule a beneficiary’s compensation plan as soon as they fail to get employed after graduating.

As soon as the grace interval of repaying the mortgage expires, it attracts increased rates of interest.

To-date, there has not been an elaborate system to trace mortgage beneficiaries who typically may change names, location and or just run away and conceal.

The mortgage scheme has, nevertheless, not been with out hassle. Within the newest cohort of beneficiaries, 47 college students are as a result of lose their mortgage awards after they declared their mother and father lifeless, or themselves disabled, with a view to fluke the examine alternative.

Govt stops mortgage assist

Final week, authorities cancelled examine loans for 47 college college students who lied concerning the demise of their mother and father.The authorities answerable for the federal government mortgage scheme ordered the affected college students to refund public funds after it emerged that others both lied about incapacity or solid unspecified paperwork.