The Impact of School Fee Loans on Educational Outcomes in Uganda

Rural Ugandans face major challenges in ensuring that children attend school. Most schools in rural Uganda are private and school fees account for a significant fraction of household income. However, the timing of school fees does not match the timing of income earned and households have limited access to financial services (e.g., borrowing and savings technologies). This project aims to increase the access to education for households in rural Uganda through a sustainable intervention that combines technology with innovative financial contracting.

Working with Fenix International, the largest solar home system provider in Uganda, we will conduct a pilot study that will offer school fee loans to a randomly selected group of customers. Through this randomized controlled trial, we will rigorously quantify the impact of school fee loans on educational outcomes by comparing households that were offered the loan to those that were not. In addition, to address financial sustainability, we will vary the contractual terms – specifically the extent to which the solar home system serves as collateral – among those offered a loan.