Education Cabinet Secretary Amina Mohamed has extended the 100 per cent waiver on penalties for Higher Education Loans Board (Helb) defaulters for one month after the agency raised Sh500 million by end of June.
Ms Mohamed said the decision to extended the waiver was reached after it emerged that more past beneficiaries were willing to repay their loans in order to support other students in need in higher learning institutions.
“Based on the enthusiasm that most loanees have shown it’s imperative that we extend the repayment period so that we give them an opportunity to repay,” said the CS in a statement.
Ms Mohamed issued the 100 per cent waiver last month and the extension was due to a request by HELB Chief Executive officer Charles Ringera.
Mr Ringera said HELB had recovered Sh508million from 9,112 loanees who had paid within the amnesty period which started on May 3 and ended on June 30.
“A total of 5,881 loanees are holding Sh971 million and have expressed willingness to repay in lump sum but they have been unsuccessful in their quest to beat the set deadline,” said Mr Ringera in a letter to Ms Mohamed dated June 29.
Mr Ringera said an extension of one month will enable Kenyans to participate in the historic patriotic process of repaying their university students loans.
He added that an extension of amnesty for three months for the loanees in the diaspora will also help to recover more.
According to HELB, it cannot trace 17, 000 defaulters, while by last year 85,000 loan defaulters were owing the agency Sh9.6 billion.
A total of 169,909 graduates had fully repaid their loans worth Sh13.2 billion by September 2017, while some 136,783 beneficiaries were servicing loans worth Sh20.7 billion.
In 2017, HELB said it had received a surge in notifications from employers indicating retrenchment of their workers resulting in a dip in repayments.
“As a ministry, we appreciate the role HELB continues to play in facilitating access to higher education through the provision of loans, bursaries and scholarships to needy students,” said Ms Mohamed.
Since 1974, the university loan scheme has supported over 645,000 Kenyans to pursue higher education at a total cost of Sh72 billion.Since 1974, 396,680 loan accounts worth Sh47.5 billion have matured for repayment; while 264,000 loanees holding Sh24.5 billion have not matured.
Of the 396,680 loan accounts, a total of 175,003 loanees have completed their loan repayment valued at Sh16.7billion.In 2016/2017 alone, the Board recovered Sh4.1billion which accounted for 40percent of the HELB student financing budget of Sh10.2billion for the year.
By OUMA WANZALA