HELB Loan Crisis As A Number Of Students Misses
HELB Loan Crisis As A Number Of Students Misses. Once the Higher Education Loans Board (Helb) ran out of money, more than 140,000 students attending public universities and technical and vocational education and training (TVET) institutes missed out on state loans. This has made it difficult for them to find alternative sources of funding for their maintenance, housing, and education.
The students will need to wait till the Treasury provides Sh5.7 billion before receiving further payments, Helb said Parliament on Wednesday.
The majority of loan applicants are from low-income families and depend on Helb for assistance with their tuition and maintenance costs.
According to Charles Ringera, CEO of Helb, “We currently have 140,000 students in Tvets and universities that we have not been able to support to the tune of Sh5.7 billion because we have ran out of the budget that we had provided to Treasury of Sh4.5 billion.”
The 140,000 pupils virtually quadruple the 75,000 that the organization was unable to finance during a comparable time period last year when the Treasury postponed Sh3 billion in disbursements.
The students, the most of whom are first-years, will need to find alternative ways to pay for their tuition, housing, and maintenance while they wait for government funds as a result of the delayed release.
Mr. Ringera stated that a request to use a supplemental budget to cover the present funding gap was turned down.
HELB Loan Crisis As A Number Of Students Misses
The organization was given Sh14.8 billion in the current fiscal year to fund students according to their economic circumstances.
A loan applicant who is approved will receive between Sh35,000 and Sh60,000 annually.
Sh8,000 of the total loan disbursed is given to the university as tuition, and the other Sh20,000 is transferred in two equal installments, one for the first semester and the other, to the beneficiary’s bank account.
Helb Portal https://studentportal.helb.co.ke/auth/signin
Helb is meant to be a revolving fund where recipients who have finished their studies pay back to help new students.
However, this hasn’t been the case in a down economy plagued by a hiring freeze brought on by weak corporate earnings.
He explained to the National Assembly Public Investments Committee on Education and Governance that “every month we earn roughly Sh400 million from past loanees which we add to the quarterly disbursements by Treasury to service applications by ongoing students” (PICEG).
The first Treasury disbursement is often anticipated each year around August, a month before colleges and institutions begin classes in September.
The quarter’s exchequer release is about Sh3 billion, and Helb has collected about Sh1.2 billion by that point, for a total of about Sh4.2 billion. This is significantly less than the Sh7 billion needed to adequately service loan applications, the official noted.
Helb and the Treasury agreed to a settlement where payments will now be issued every six months rather than every four, in order to correct the discrepancy.
Treasury released to us Sh5.6 billion in September of last year, and at the time, we had amassed roughly Sh4 billion. We were able to pay the entire price for September and October once we totaled the two, according to Mr. Ringera.
The Treasury only released Sh2.5 billion for semester two’s December payments; the remaining funds just arrived on Helb’s account a few weeks ago as a result of student protests in the streets.
Over the years, Helb has struggled to keep up with the growing demand for loans.
In public universities, the number of government-sponsored students has increased at the quickest rate in the previous five years.
The proportion of candidates who attended college
The number of candidates who passed the Kenya Certificate of Secondary Education (KCSE) exam in 2022 with the required grade for entry to a university increased by 19% to 173,345 from the 145,776 recorded the previous year.
Nearly all students who earned a C+ or higher over the previous five years were accepted into the regular university programs, making them eligible for Helb loans.
Helb’s capacity to support university and technical college students has been eroded by loan defaulters, resulting in budget cuts and a greater reliance on the Treasury.
At the height of the Covid-19 pandemic, more than 100,000 former university students missed payments on their Helb loans.