1. Introduction

The Higher Education Students Loans and Grants Board (HESLGB) was established by an Act of Parliament No. 2 of 2015 as one of the reforms for the Ministry of Education in financing higher education. HESLGB is mandated to provide loans and award grants to needy and academically outstanding students, respectively, who are pursuing higher education in accredited institutions of higher learning in Malawi. It is also mandated to recover matured outstanding loans from all loan beneficiaries.

This Press briefing wants to communicate major developments that have taken place within the Board.

1.2. Review of the students’ upkeep loans 

As you are aware, His Excellency Dr. Lazarus McCarthy Chakwera, President of the Republic of Malawi, as the Chancellor for the public universities directed the Ministers of Education and Finance on March 6, 2024, to review the upkeep loans for needy and deserving students, in light of changes in macroeconomic fundamentals.

Subsequently, from March 22 to March 23, 2024, a meeting was convened involving representatives from the Ministry of Education (MoE), Ministry of Finance and Economic Affairs (MoFEA), and the Higher Education Students Loans and Grants Board (HESLGB) to assess the existing students’ upkeep loan value of K350,000 per student per academic year.

The directive followed a meeting that the Chancellor had with university students’ representatives in which the students requested an adjustment of the upkeep loan from K350,000 to K650,000 per year.

1.2.1 HESLGB proposed Scenarios 

HESLGB came up with five scenarios to guide the discussion with the Ministries of Education and Finance on the review of the student upkeep loans, as follows: 

1.2.2 Assumptions used to analyze the students’ upkeep Loan Adjustment 

The following   assumptions were used in determining the upward adjustment of students’ upkeep loans:

1. Duration of review;
2. Average Inflation rates;
3. Students living expenses;
4. Average growth of the number of students considered for loans, annually
5. Budget affordability and fiscal space
   1. Eligibility 

1.2.3 Discussions

The stakeholders extensively deliberated on the scenarios that were provided concerning the assumptions outlined above. Specifically, they considered an average inflation rate of 30 percent and the last review of upkeep loans which happened in the academic year 2021/22. Additionally, they factored in an average growth rate of 15 per cent in the student population based on historical data.

Based on these assumptions, the stakeholders determined that the appropriate upkeep level fell within the range of K500,000 to K600,000. Ultimately, they decided on K560,000, as the new upkeep loan, which was derived from the calculation of the current inflation rate compounded over two outward years. This translates to a 60 per cent upward adjustment applied to the current loan amount of K350,000.

It's worth noting that the K560,000 per student per academic year translates to K280,000 per semester of 4 months or K70,000 per month within a semester.

1.2.4 Proposed Adjustment’s Impact on the Budget

The financial implication of adjusting students' upkeep loan from K350,000 to K560,000 amounts to K3.8 billion (K3,850,980,000.) This new upkeep loan allowance structure to students in public schools is effective 1st April 2024.

2.0 OPENING OF THE 2024/25 LOAN APPLICATION WINDOW

The loan application window for the 2024/25 loan cycle will open from 1st May to 30th June 2024.

As you may be aware, HESLGB with funding from the World Bank through the Skills for a Vibrant Economy (SAVE) Project is supporting students who are studying in the Open Distance e-learning (ODeL) mode in public universities in the priority study areas of Education, Health, Agriculture, Energy, Information Communications Technology (ICT), and Industry. Through the project, in the 2024/2025 loan cycle, HESLGB will consider 288 additional female ODeL applicants in public universities in the mentioned priority study programs. 

Please note that loans are only provided to students who apply and meet the eligibility criteria. Therefore, both existing and new ODeL beneficiary students must apply to express their interest to be considered for a loan for the 2024/2025 loan cycle.

All students, including existing beneficiaries and prospective, must submit fresh applications for this academic year within the specified time frame to be considered. Applications submitted outside this period will not be accepted.

Eligible applicants are students who have proof that they are needy and have been selected to pursue or are pursuing accredited degree programs at a public/private accredited university or college.

1. Application Method

All applications will be conducted online on the Students’ Financing Management Information System (SFMIS). All students should visit https://sfmis.heslgb.mw. To get information on how to apply.

1. Application Fee

The Malawi Kwacha adjustment which happened last year necessitated the Board to adjust upwards the application fee for students applying for the loans to K7,500 from the old K5,000. This means that all applicants MUST pay a non-refundable loan processing fee of K7,500 which MUST be deposited to account numbers that have been provided on the application form. The Proof of payment must be uploaded together with the application form, clearly indicating the name of the applicant.

1. Documentation 

The Board requires that applicants provide supporting documents to their applications, these include:

• Copy of the applicant’s National ID with correct and relevant names or an NRB form with a system-generated sticker.
• A copy of the parent’s/guardian’s National ID
• Copy of applicant’s Student ID/Copy of University/College admission letter
• Copy of MSCE (ODeL/Private Universities/Colleges)
• Deposit slip of non-refundable application fee 
• Guarantor consent form. This should be downloaded from www.heslgb.mw and uploaded to sfmis.heslgb.mw.
  1. Important points to NOTE

• Applications are done annually.
• Applications are accepted within the application window.
• Students apply for a loan for the next level of study.
• Names on the Student ID must match those on the National ID.
• Students with mismatched names should rectify with the NRB to avoid rejection.
• No hard-copy applications will be accepted.
• Applications without supporting documents will not be processed.
• New ODeL applications should be female students in public universities studying the mentioned priority areas.

3.0 Mobile Phone App

To facilitate easier access to the online application platform for all students, the Board will be launching a Mobile Phone App. This app will enable students to apply for loans directly from their mobile devices. The app is scheduled to be available for download on Google Play Store and Apple Store starting from May 1.

Remember that the deadline for loan applications is June 30, 2024.

HESLGB: SUPPORTING NEEDY AND DESERVING STUDENTS TO ACCESS HIGHER EDUCATION IN MALAWI

PAYBACK YOUR STUDENTS’ LOAN