Annual loan not enough for students, says Helb

A university student requires an average of Sh122,000 per year to study comfortably, the Higher Education Loans Board has revealed.

The annual average loan of Sh37,000 is inadequate because of increased school fees and the high cost of living, it says.

The disparity is revealed in Helb's five-year strategic plan, 'Helb Agenda 2019-23'.

That's what loan recipients tell the Star.

“The Helb loans I have been receiving are not enough to sustain me since my background is needy. I receive no upkeep from my parents,” Lynn Cate said.

Loan recovery improved by 40 per cent between 2013 and last year.

However, the number of beneficiaries in Technical and Vocational Education and Training institutions rose from  3,000 to more than 47,000 over that period.

Because of high enrollments, Sh1.2 billion was channelled to the TVETs, reducing disbursements to students in other institutions.

In 2017-18, students' funding budget was  Sh11.4 billion, about 60 per cent of the envisaged Sh19.054 billion. Students, therefore, received loans far below their expectations and needs.

“Sometimes we apply for more money but we do not receive it, some of us are struggling in our education life,” Brian Mochoge said.

Helb loans attract four per cent interest, while the cost of funds is about eight per cent.

If the government does not chip in, the funds will decline with time.

“In the long run, the fund may be shrinking without government intervention through capitation,” the Helb board of directors said in the strategic plan.

As the lender has expanded funding of the TVET sector, more graduates including the unemployed, are moving to the informal sector.

Therefore, Helb aims to develop effective strategies to enhance loan recoveries from the growing informal sector clientele.

Helb chief executive Charles Ringera called upon the government and other Helb stakeholders to continue working towards achieving universal funding for students of higher learning. 

(Edited by R.Wamochie)