Governing Student Loan Recovery in Uganda’s Higher Education System: A Human Capital Theory Analysis of Board Roles and Institutional Effectiveness

Abstract

This study examined the influence of leadership, institutional legal frameworks, and networking on student loan recovery among beneficiaries of Uganda’s higher education loan programs. The research was guided by three objectives: (1) to assess the effect of leadership on repayment, (2) to evaluate the implementation of institutional legal frameworks, and (3) to examine the role of networking and stakeholder engagement. A quantitative survey design collected structured responses from graduates and stakeholders, complemented by qualitative comments to enrich interpretation. Data analysis employed descriptive statistics, hierarchical regression, multiple correlations, factor analysis, and thematic qualitative analysis, interpreted through Human Capital Theory (HCT). Hierarchical regression indicated that leadership alone explained 24.3% of the variance in loan recovery (Beta = 0.56, p < 0.01), legal frameworks added 21.7% (Beta = 0.42), and networking contributed an additional 19.8%, leading to a total R² of 65.8% (p < 0.01). Correlations revealed strong associations between leadership and repayment (r = 0.78), legal frameworks (r = 0.75), and networking (r = 0.70). Qualitative data confirm that leadership, legal enforcement, and stakeholder collaboration improve loan repayment compliance. According to Human Capital Theory, these governance mechanisms protect educational investments by ensuring skills translate into productive outcomes. Gaps in motivation, employer compliance, and tracking highlight areas where human capital returns remain incomplete. It was noted that leadership clearly guides the recovery process, making it easier for us to comply, while others noted that collaboration and information sharing help track repayments effectively and reduce defaults. The study concludes that leadership, legal frameworks, and networking jointly enhance student loan recovery, with leadership exerting the strongest influence. Actionable recommendations include implementing motivational incentives and awareness programs, strengthening enforcement through audits and employer agreements, and developing digital systems for post-graduation tracking complemented by institutional and alumni partnerships. These measures ensure that investments in education yield tangible economic and social returns, sustain the revolving student loan fund, and provide policymakers, loan boards, and educational institutions with evidence-based strategies to improve repayment compliance and the sustainability of higher education financing in Uganda and similar contexts.