Following the green light from the Lower House on the Bill governing the disbursement of student loans, needy learners seeking funding from the Government will have to apply through a competitive process.

With this year’s first call for application already complete, students have to wait for the last call between October and November for the March 2016 intake.

Prof James McWha, the outgoing vice-chancellor of the University of Rwanda, said more students would be supported this year under a process that will be completed soon.

"The processing will ensure that the students get funding for food, accommodation and study materials, among others, before they begin their lectures,” McWha told The New Times in an interview last week.

He said effective the upcoming academic year, the funds would be channelled through Development Bank of Rwanda (BRD).

"Last year, the allowances were disbursed through the university, but this time around they will be handled by the bank,” McWha added.

Application and selection

Students will apply through the university website and selection will be based on both academic merit and social economic status under the Ubudehe (social stratification) classification.

The selection criteria for local students will continue to be informed by the Ubudehe categories.

Ubudehe levels:

Category 1: People who need to beg to survive, have no land, livestock, shelter, adequate clothing and food. They lack access to medical care and have malnourished children that do not attend school.

-Category 2: These have similar traits as those in Category 1 although they are physically capable of working on land owned by others with very small landholdings, and without any livestock.

-Category 3: These have some land and housing, but live off their own labour and produce. They have no savings, but they can eat, even if the food is not very nutritious.

-Category 4: These are similar to the third category, but may have small ruminants and their children go to primary school.

-Category 5: This group has larger landholdings on fertile soil and enough to eat. They also own livestock, often have paid jobs and can access healthcare.

-Category 6: People in this category have land, livestock and salaried jobs, as well as good housing. They often own a vehicle, have enough money to lend and access to credit from the bank.

Eligibility

Students in categories 1-4 will be eligible to apply for a student education loan to cover 100 per cent of their tuition fees and living allowances.

According to Fred Mugisha, the director of planning and policy at the Higher Education Council, priority will be given to those who are most financially vulnerable, but they will have to meet the required grades.

"Since the funds are not enough, a limited number of students will be supported,” Mugisha said.

He further explained that on top of the funding, students in the first category of Ubudehe will continue to receive Rwf25,000 each month in either living allowance.

"Those who want to apply for tuition alone, allowances or for research are welcome and will also be considered for that particular application,” he explained.

However, applicants seeking sponsorship to study abroad shall apply directly to the Rwanda Education Board (REB), but priority will go to particular courses as the advertisements will specify, whereas doctoral students will be required to register with the University of Rwanda before applying to REB.

"For those considered for studying abroad, they will have the cost of the air ticket covered on top of their tuition, living allowances and study materials,” Mugisha added.

Submitting lists to BRD

Under the new legislation, public higher learning institutions, after admitting students, will submit lists of eligible students to the Ministry of Education before a committee, composed of four representatives of the Higher Education Council and three representatives of the University of Rwanda, selects students.

A list of selected students for the study loan will then be forwarded to the financial institution (BRD).

Alex Kanyankore, the chief executive officer of Rwanda Development Bank, explained that the bank would ensure that there is efficiency in remittance of the funds.

"Once we receive the lists we shall then do the necessary, processing payment within a       much shorter timeframe than before. The previous mode of transaction included a long list of signatories, but now the process is way shorter,” Kanyankole said.

On the duration of the process, Kanyankore said: "Posting money on the account does not require a lot of time; with the necessary documentation even within a day, this money can be remitted to the institution.”

After completing the course, students are required to repay the loan with an interest of 11 per cent of the principal upon employment, which the employer must guarantee.

On ensuring complete recovery, Kanyankore added that there are strategies in place to ensure that these loans are revolving to help other students.

"There are penalties on the borrower and the employer in case of non-compliance. The Credit Reference Bureau will also continue doing its work of tracking all borrowers,” he added.

Meanwhile, beneficiaries of the scheme expressed optimism over this new arrangement.

Christian Munyaneza, a student of business administration at UR’s College of Business and Economics in Gikondo, said: "I applied in July for the loan scheme and I was told to first register. However, there were many of us who wanted this kind of support and that’s why I am grateful for any kind of financing.”

However, Bernard Munyaneza, a third-year student of journalism and communication, is concerned about the fixed allowances.

"I applied last year for the loan and luckily got it, but I was only given tuition, yet other students get the full package. Although I am grateful for the support, I wish I had received similar privileges,” he said.