IDEAS home Printed from https://ideas.repec.org/a/eee/epplan/v114y2026ics0149718925001417.html

Optimising student loan recovery in Malawi: Bridging policy gaps, socio-economic realities, and administrative challenges

Author

Listed:
  • Moyo, Reuben
  • Mbelwa, Jimmy
  • Kachingwe, Evelyn
  • Lungo, Juma

Abstract

In Malawi, where student loans are crucial for expanding access to higher education, poor loan recovery poses a significant threat to the sustainability of financing and socioeconomic development. The study investigates student loan recovery challenges at Malawi’s Higher Education Student Loans and Grants Board (HESLGB), where rigid salary deductions result in a 32.6% non-repayment rate. A mixed-methods approach, grounded in behavioural economics, analyses survey data from 289 borrowers and interviews with 12 staff. Four themes, including enforcement mechanisms, borrower support systems, repayment schedules, and penalties, highlight barriers linked to a 70% informal workforce and administrative gaps. Unemployment, rigid schedules, and poor tracking impede recovery. We propose income-contingent repayment plans, digital platforms, borrower education, and policy reforms, drawing on regional models to offer scalable solutions for low- and middle-income countries.

Suggested Citation

  • Moyo, Reuben & Mbelwa, Jimmy & Kachingwe, Evelyn & Lungo, Juma, 2026. "Optimising student loan recovery in Malawi: Bridging policy gaps, socio-economic realities, and administrative challenges," Evaluation and Program Planning, Elsevier, vol. 114(C).
    • Handle: RePEc:eee:epplan:v:114:y:2026:i:c:s0149718925001417
    DOI: 10.1016/j.evalprogplan.2025.102674
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0149718925001417
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.evalprogplan.2025.102674?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to

    for a different version of it.

    References listed on IDEAS

    as
    1. Manojit Bhattacharjee & Meenakshi Rajeev, 2013. "Modeling Loan Repayment Behavior in Developing Countries," Applied Economic Perspectives and Policy, Agricultural and Applied Economics Association, vol. 35(2), pages 270-295.
    2. Katharine G. Abraham & Emel Filiz-Ozbay & Erkut Y. Ozbay & Lesley J. Turner, 2018. "Behavioral Effects of Student Loan Repayment Plan Options on Borrowers’ Career Decisions: Theory and Experimental Evidence," NBER Working Papers 24804, National Bureau of Economic Research, Inc.
    3. Adam Looney & Constantine Yannelis, 2015. "A Crisis in Student Loans? How Changes in the Characteristics of Borrowers and in the Institutions They Attended Contributed to Rising Loan Defaults," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 46(2 (Fall)), pages 1-89.
    4. World Bank & UNESCO, 2024. "Education Finance Watch 2024 : Key Findings about Education Financing," Education Notes 194370, The World Bank.
    5. World Bank & UNESCO, 2024. "Education Finance Watch 2024 : Key Findings about Education Financing," Education Working Papers 194370, The World Bank.
    6. Nor Balkish Zakaria & Muhammad Rasyid & Norazida Mohamed & Dalila Daud & Aida Maria Ismail, 2020. "Study Loan Defaults Among Tertiary Graduates," International Journal of Financial Research, International Journal of Financial Research, Sciedu Press, vol. 11(3), pages 125-130, June.
    7. World Bank & UNESCO, 2024. "Education Finance Watch 2024," World Bank Publications - Reports 42582, The World Bank Group.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Cox, James C. & Kreisman, Daniel & Dynarski, Susan, 2020. "Designed to fail: Effects of the default option and information complexity on student loan repayment," Journal of Public Economics, Elsevier, vol. 192(C).
    2. Eaton, C. & Kulkarni, K. & Birgeneau, Robert & Brady, Henry & Hout, Michael, 2017. "AFFORDING THE DREAM: Student Debt and State Need-Based Grant Aid for Public University Students," University of California at Berkeley, Center for Studies in Higher Education qt24j8945b, Center for Studies in Higher Education, UC Berkeley.
    3. Anisfeld, Ari & Bell, Elizabeth & Gurantz, Oded & Kramer, Dennis A., 2025. "Costly withdrawals reduce future college-going for low-income students: Evidence from Return of Title IV funds," Economics of Education Review, Elsevier, vol. 109(C).
    4. Jinhee Kim & Swarn Chatterjee, 2019. "Student Loans, Health, and Life Satisfaction of US Households: Evidence from a Panel Study," Journal of Family and Economic Issues, Springer, vol. 40(1), pages 36-50, March.
    5. Celeste K. Carruthers & Christopher Jepsen, 2020. "Vocational Education: An International Perspective," CESifo Working Paper Series 8718, CESifo.
    6. Berrak Bahadir & Dora Gicheva, 2022. "Macroeconomic Implications of Student Debt: A State‐Level Analysis," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 54(8), pages 2273-2300, December.
    7. repec:fip:fedpwp:97987 is not listed on IDEAS
    8. Joselynn Hawkins Fountain, 2019. "The Effect of the Gainful Employment Regulatory Uncertainty on Student Enrollment at For-Profit Institutions of Higher Education," Research in Higher Education, Springer;Association for Institutional Research, vol. 60(8), pages 1065-1089, December.
    9. Gustavo Pereira Serra, 2025. "(Trying to) catch up with the higher-skilled Joneses: student loans in a segmented educational market from a post-Keynesian perspective," Journal of Post Keynesian Economics, Taylor & Francis Journals, vol. 48(2), pages 172-203, April.
    10. Manuel S. González Canché, 2017. "Financial Benefits of Rapid Student Loan Repayment: An Analytic Framework Employing Two Decades of Data," The ANNALS of the American Academy of Political and Social Science, , vol. 671(1), pages 154-182, May.
    11. Moumita Poddar & Tanmoyee Banerjee (Chatterjee) & Ajitava Raychaudhuri, 2019. "An economic analysis of the determinants of pattern of institutional borrowing in India," Journal of Social and Economic Development, Springer;Institute for Social and Economic Change, vol. 21(1), pages 54-92, June.
    12. Trevor J. Bakker & Stefanie DeLuca & Eric A. English & Jamie Fogel & Nathaniel Hendren & Daniel Herbst, 2025. "Credit Access in the United States," Working Papers 25-45, Center for Economic Studies, U.S. Census Bureau.
    13. Mueller, Holger M. & Yannelis, Constantine, 2019. "The rise in student loan defaults," Journal of Financial Economics, Elsevier, vol. 131(1), pages 1-19.
    14. Ann M. Gansemer-Topf & Jillian Downey & Katherine Thompson & Ulrike Genschel, 2018. "Did the Recession Impact Student Success? Relationships of Finances, Staffing and Institutional Type on Retention," Research in Higher Education, Springer;Association for Institutional Research, vol. 59(2), pages 174-197, March.
    15. Eaton, Charlie & Kulkarni, Sheisha & Birgeneau, Robert & Brady, Henry & Hout, Michael, 2017. "AFFORDING THE DREAM: Student Debt and State Need-Based Grant Aid for Public University Students," University of California at Berkeley, Center for Studies in Higher Education qt093215zt, Center for Studies in Higher Education, UC Berkeley.
    16. Jeffrey T. Denning & Todd R. Jones, 2021. "Maxed Out?: The Effect of Larger Student Loan Limits on Borrowing and Education Outcomes," Journal of Human Resources, University of Wisconsin Press, vol. 56(4), pages 1113-1140.
    17. Lael Brainard, 2017. "Why Opportunity and Inclusion Matter to America’s Economic Strength : a speech at the Opportunity and Inclusive Growth Institute Conference, sponsored by the Federal Reserve Bank of Minneapolis, May 22, 2017," Speech 953, Board of Governors of the Federal Reserve System (U.S.).
    18. Stoddard, Christiana & Urban, Carly & Schmeiser, Maximilian, 2017. "Can targeted information affect academic performance and borrowing behavior for college students? Evidence from administrative data," Economics of Education Review, Elsevier, vol. 56(C), pages 95-109.
    19. Luis Armona & Rajashri Chakrabarti & Michael F. Lovenheim, 2018. "How Does For-profit College Attendance Affect Student Loans, Defaults and Labor Market Outcomes?," NBER Working Papers 25042, National Bureau of Economic Research, Inc.
    20. Di, Wenhua & Su, Yichen, 2024. "Conspicuous consumption: Vehicle purchases by non-prime consumers," Journal of Economic Behavior & Organization, Elsevier, vol. 224(C), pages 895-914.
    21. Looney, Adam & Yannelis, Constantine, 2022. "The consequences of student loan credit expansions: Evidence from three decades of default cycles," Journal of Financial Economics, Elsevier, vol. 143(2), pages 771-793.

    More about this item

    Keywords

    ;
    ;
    ;
    ;
    ;
    ;

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:epplan:v:114:y:2026:i:c:s0149718925001417. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/evalprogplan .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.