Higher Education Students Loans and Grants Board (HESLGB) has threatened legal action against all employers defying its request for support in repaying education loans of their employees.
Speaking on Friday in Lilongwe the board’s executive director Chris Chisoni warned that non-compliant employers risk being fined K1.2 million per employee who accessed a loan but has not paid back.
“It is actually illegal and punishable by law that employers we have officially written are not responding,” he said when board officials met 15 employers who have been outstanding in supporting their employees to repay the loans.
“We have taken the past three years as inception phase where we are allowing various employers to know the loans board existence, its functions and legal mandate.”
Chisoni said that out of the K672 million recovered by January 31 this year, 87 percent has been through the support of employers.
He said 10 percent of the recovered loans were through the support of Credit Reference Bureau (CRB).
He said 1 772 needy students have been supported using the recovered loans the past years.
Chisoni further warned that the loans board will be naming and shaming in the media those who benefited from the loans but have not paid back to enhance the repayment process.
One of the institutions recognised for its role in the loan recovery, Institute of Chartered Accountants in Malawi (Icam) said it considers its involvement more of a moral obligation than a legal one.
Icam finance manager Abel Chihana said: “We are proud for complying with recovery students’ loans.
“We are proud to support the government development agenda of bridging the gap between the poor and the rich in accessing higher education in the country.”