Determinants of educational loan repayment behaviour among public education loan borrowers

Abstract

Educational loan schemes play a crucial role in expanding access to higher education; however, challenges in loan repayment continue to threaten the sustainability of public education financing systems. This study examines the determinants of educational loan repayment behaviour among public education loan borrowers, focusing on the influence of income level, borrower attitude and loan interest rate. A quantitative research design was employed, with data collected from 50 borrowers through a structured questionnaire. The data were analysed using descriptive statistics, Pearson correlation and multiple regression analysis. The findings reveal that borrower attitude and loan interest rate have significant positive effects on educational loan repayment behaviour, while income level does not demonstrate a statistically significant relationship when other factors are taken into account. Borrower attitude emerges as the most influential predictor, highlighting the importance of behavioural factors such as responsibility and commitment in shaping repayment behaviour. The significance of loan interest rate indicates that borrowers’ perceptions of repayment burden and borrowing cost also influence their repayment decisions. These findings suggest that improving repayment performance requires a balanced approach that goes beyond financial capacity by incorporating behavioural and policy considerations. The study provides useful insights for policymakers and education financing institutions in designing strategies to enhance repayment compliance and ensure the long-term sustainability of public education financing schemes.