Higher education at risk as board seeks access to tax, transport records to track loan defaulters
NAIROBI — Kenya’s Higher Education Loans Board (HELB) has announced it is broke and unable to disburse loans to new students or process new student loan applications, placing thousands of university and tertiary students in need of financial assistance from low income households at risk.
HELB confirmed it received only Ksh 26 billion in the last financial year, falling short of its Ksh 48 billion requirement. The shortfall left over 100,000 students without full financial support, with some receiving only upkeep stipends and no tuition payments.
“We paid upkeep for some, but not tuition. Second semester is worse we haven’t paid tuition at all,” HELB Chief Executive Geoffrey Monari stated on Monday.
The agency prioritized student upkeep to avoid unrest, but the strain has now shifted to institutions of higher learning. Public universities and technical training institutes are struggling to operate without the tuition remittances they rely on from HELB.
“Universities and TVETs are bleeding. We avoided protests, but the money is simply not enough,” HELB Chief Executive Geoffrey Monari said.
While the board grapples with the funding crisis, thousands of past loan recipients are yet to begin repayment despite being gainfully employed. Some, HELB says, have even acquired luxury vehicles but continue to default on their obligations.
HELB is now seeking access to personal data held by the Kenya Revenue Authority (KRA) and the National Transport and Safety Authority (NTSA) to track and recover unpaid loans.
“We’re working with KRA and NTSA. Some have bought cars but won’t repay their HELB loans that has to stop,” HELB Chief Executive Geoffrey Monari said.
To secure long-term funding, HELB is proposing new financial reforms. One includes introducing a 3% education levy drawn from the country’s Value Added Tax, modeled on Ghana’s 2.5% allocation to its education fund.
“We’re proposing a 3% VAT allocation to fund higher education just like Ghana,” Monari added.
Another proposal on the table is a voluntary education savings scheme for parents. Under the plan, parents would contribute to an investment fund managed by HELB, which would allow them to earn dividends and borrow against their savings when needed for school fees.
“Parents can save, earn dividends and even borrow from it. It’s like any other investment fund,” said Julius Melly, Chair of the Parliamentary Committee on Education.
Without urgent intervention, the September intake faces disruption. HELB has warned that unless fresh funding is secured, thousands of students may be excluded from pursuing higher education in the coming academic year.
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