Helb reels from Sh6.6bn bad loans


  • Financier has hard time tracking beneficiaries from between 1974 to 1977
  • Board is eyeing Sh150m loans recovery from diaspora this year

The Higher Education Loans Board (Helb) is reeling from Sh 6.6 billion non-performing loans advanced to 64,000 former university students in what could indicate inability to repay.

While the Board says Kenyans in the diaspora who benefited from the loans repaid Sh100 million last year, following its widening of the net, some beneficiaries cannot be traced.

Helb Chief Executive Officer Charles Ringera said: “We are having a problem tracing students who benefited from Helb loans between 1974 and 1979 when we did not have an Information Technology (IT) system in place to manage the loans and track defaulters.”

He was speaking on Thursday during the signing of Memorandum of Understanding (MOU) between Bomet County government and Helb, which will see the board manage Sh30 million revolving loans fund to benefit students from the county in various universities and colleges in the country.

Currently, the board has 300,000 students studying in various institutions who have been allocated Sh24 billion as loans.

Mr Ringera said that Helb had disbursed Sh84 billion since inception and that last year Sh16 billion was disbursed to benefit university students and those in Technical Vocational Education and Training (TVET) institutions.

“Sh10 billion was channelled to university students while Sh5 billion was dvanced to those in TVET institutions and a similar amount of loans will this year be channelled to the institutions,” said Mr Ringera.

Defaulters data

The data on defaulters is shared by the board with Credit Reference Bureau, banking institutions and employers in a bid to track the defaulters and recover the loans.

“Last year, 20,000 Kenyans in the diaspora repaid the Sh100 million loans and we are targeting Sh150 million this year with majority of the money channelled from Europe and Western countries,” said Mr Ringera.

Safaricom's M-Pesa platform has become the favoured channel by those in the diaspora to repay the loans with the board, with the help of embassies, currently targeting Kenyans in Asian countries.

Bomet governor Dr Joyce Laboso said that the Sh30 million loans would benefit 1,500 students in the current financial year.

“This year we have allocated Sh30 million to the fund and a similar amount will be allocated in the 2019/2020 financial year and another Sh20 million the following year. This is a programme that will run over the years respective of who will be the governor,” said Dr Laboso.

Dr Laboso said the policy document for the allocation of the money had been passed in a bid to raise the transition and retention rate of students in higher learning institutions.