Student loan
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Heavier loan burden for graduates

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Families are paying higher fees than before under the higher education funding model will saddle students with hefty loans upon graduation.

Photo credit: Nation Media Group

Families are paying higher fees than before under the higher education funding model unveiled by the government last year and will saddle students with hefty loans upon graduation, analysis by Nation indicates.

The model, which enters its second year in the current financial year, also faces funding challenges from the National Treasury as indicated by delays in the disbursement of money to the Higher Education Loans Board (Helb) and the Universities Fund (UF).

Students who apply for government funding will graduate with heavier loan burdens as compared to the old model irrespective of whether they are classified as needy or less needy. Since January 2024, the UF has received 9,726 appeals from students who felt they had been placed in the wrong categories. 4,087 of these were successful while 5,639 others were declined.

The government support is through scholarships that are awarded by the UF and student loans that are awarded through the Helb. Whereas students will not be required to pack back the scholarship component, the tuition loan and upkeep loan will be payable upon graduation and will attract a four per cent interest per year. Under the old model, graduates only pay for the upkeep loan and the scholarship (grant) has been automatic for all government-sponsored students.

For example, a student classified under Band 1 (the most needy) pursuing a degree in medicine at a total cost of Sh520,000 per year qualifies for a scholarship of Sh364,000 (70 per cent of the total), a student tuition loan of Sh130,000 (25 per cent) and upkeep loan of Sh60,000 per year. The student’s household is expected to pay the balance of Sh26,000 per year.


In six years, the student’s total loan will be Sh1,140,000 while those under the old model who receive the maximum upkeep loan will only have Sh360,000 to pay back to the government.

The tuition fees for a bachelor of arts degree is the cheapest across all universities with the lowest being Sh144,000. A student under Band 1 qualifies for a scholarship of Sh100,800 and a tuition loan of Sh36,000 per year. Such a student also qualifies for a maximum upkeep loan of Sh60,000. At the end of the four-year course, the debt burden owed to the government will be Sh384,000 while those under the old model will only pay Sh240,000.

“It’s not just about the fees. When the Helb delayed releasing our money for upkeep, most of the first year students suffered and at times were forced to borrow from students in other years [of study] to pay for accommodation and meals,” *Eric Maina a student at Kenyatta University told Nation.

The model also appears to have pushed more students to ditch public universities and enrol in private universities as shown by the placement data released by the Kenya Universities and Colleges Central Placement Service (Kuccps). Over 18,000 students, up from 9,000 the previous year chose to be placed in private universities. This year, in total, the service placed 153,274 students at various universities.

Students who will join university and college in August are currently applying for funding, with the results expected from July 31 2024. It is after that the students will know the amount of fees they will be expected to pay after factoring in the government support. 

“The government has noted that some parents and guardians have had a perception that they will be required to pay the full fees as contained in the admission letters issued by individual universities. The parents’ contribution will only be known after the student has applied for funding and assessment based on level of need is completed,” said Education Cabinet Secretary Ezekiel Machogu.

The CS has instructed universities to notify all first-year students of their expected contribution after receiving the results of the amounts awarded by the UF and Helb.

Allocate enough resources

Prof Egara Kabaji, a lecturer at Masinde Muliro University of Science and Technology told Nation that for the model to work, the government must allocate enough resources and make timely disbursements.

“It doesn’t matter whatever model we use. As long as we’re not committed to what we’ve agreed to do, it’s dead on arrival. We’ll still have deficits and the model will not get us out of the woods if we don’t do what needs to be done,” he said.

According to him, the model is a “cut-and-paste job” borrowed from the West that cannot work in the Kenyan situation. He said that most students in the West work as they study to supplement their education costs as opposed to Kenya where students find it hard to find work even after graduation. This, he said could lead to a high default rate on the students’ loans leading to a collapse of the model which is supposed to operate like a revolving fund.

Last month, the Principal Secretary for Higher Education Beatrice Inyangala told the National Assembly Education Committee that the National Treasury had not remitted Sh29 billion to both the UF and the Helb. This included Sh7.9 billion meant for scholarships for first-year students under the funding model and Sh4.2 billion for scholarships to technical and vocational education and training (Tvet) students.

A further Sh6.7 billion had not been released to Helb for students in both universities and Tvet institutions under the old and new models.

“The delays in scholarships and loan disbursements affect students who depend on these funds to finance their education. Many students experience financial hardship, jeopardizing their academic pursuits and overall well-being,” Dr Inyangala said.