Tuesday, 15 July, 2025
MPs question HELB on status of loan recovery and Universty funding model
Nairobi County Tuesday, July 15th 2025
Members of the National Assembly have put the Higher Education Loans Board (HELB) to task over on delayed disbursements, low loan recovery, lack of and the sustainability of the University Funding Model.
In an oversight visit to the HELB Office in Nairobi County, the Committee on Education engaged HELB CEO, Mr Geoffrey Monari and Board Chairperson, Hon. Ekwe Ethuro.
Committee Chair Hon. Julius Melly led the Committee in expressing concern about the uncertainty caused by the Means Testing Instrument (MTI), used to assess students’ financial need.
“One of the issues giving Kenyans sleepless nights is this university funding model. Students and parents don’t understand how it works. What are you doing to simplify and demystify it?” Hon. Melly asked.
Lawmakers acknowledged the new model, HELB no longer gives a flat-rate loan but allocates funds based on students’ economic status.
According to submissions by HELB, in the 2024/25 financial year, HELB disbursed KShs.26.1 billion to 322,338 university students and KShs.7.9 billion to 225,048 TVET trainees. However, over 160,000 eligible students were not funded due to a budget shortfall of KShs.13.7 billion.
Committee Members raised concerns regarding the impact of delays, especially for first-year and TVET students.
“What are you doing to ensure all first-years report to university on time?” posed Hon. Peter Orero.
Members also questioned HELB’s loan recovery efforts, given that over KShs.15 billion remains in default. CEO Monari revealed that the Board has recorded 1.03 million matured loan accounts, out of which 293,122 are non-performing, valued at KShs.33.2 billion.
“We did a study and found that it takes an average of six years for some graduates to get a job. Even among those working, underemployment makes repayment difficult,” CEO Geoffery Monari told the Committee.
Hon. Eve Obara and Hon. Joshua Makilap pressed for strategies to recover loans from employed graduates and interns. “How are you partnering with employers to trace and recover these loans?” Hon. Makilap asked.
CEO Monari explained that HELB had recovered KShs.5.21 billion in the 2024/25 financial year — an 11% increase from the previous year. This was achieved through linkages with KRA and employer audits, which helped trace over 17,000 defaulters. Additionally, collaboration with the Civil Registration Services led to the writing off KShs.347 million in deceased loanee accounts.
To address growing defaults, Monari said HELB is exploring an income-contingent repayment (ICR) model and flexible options such as weekly payments targeting informal sector workers.
MPs also expressed concern about the opacity of bursary awards and questioned the rationale behind proposed consolidation of bursaries under HELB.
“We previously had consolidated bursaries under the Ministry of Education, and they did not benefit everyone. What safeguards are you putting in place this time?” asked Hon. Abdul Haro.
In response, Mr. Monari clarified that the proposal only seeks to consolidate information, not funds. “We want to ensure students don’t double-dip from HELB, counties, and banks without full disclosure,” he said.
Lawmakers including Hon. Rebecca Tonkei and Hon. Dick Maungu called out HELB’s inadequate public sensitization. “There’s a lot of misinformation and confusion. How are you reaching students in rural and marginalized areas?” asked Hon. Tonkei.
The Committee also raised concerns about equity in scholarships, support for minors, students with disabilities, and those from hardship areas. Hon. Mary Emaase queried how HELB prioritizes applicants amid funding gaps.
“With the high number of unfunded students, how do you decide who gets a loan? We must enhance recovery to fund more deserving students,” she said.
Mr. Monari confirmed that HELB is also engaging KMTC, TVETs, and non-Ministry institutions to align funding structures. “We funded 12,000 KMTC students last year and are in dialogue with TVETs and other professional institutes to develop of mechanisim to fund students in institutions not under the Ministry of Education,” he added.
While commending HELB for automating services and launching self-service portals, MPs said the agency must do more to address eCitizen system failures, diaspora repayments, and delayed reconciliations.
On sustainable funding, HELB Board Chair, Hon. Ekwe Ethuro said, "The growing number of students qualifying for higher education, coupled with the implementation of the Student-Centered Funding Model (SCFM), has significantly increased the demand for student loans. However, the absence of a predictable and scalable financing mechanism continues to expose HELB to persistent funding shortfalls."
HELB proposed legislation to establish a dedicated student education levy on employers or ring-fence 3% out of the existing % VAT charged, for direct allocation to HELB. This model draws on best practice from countries like Ghana, where the GETFund (Ghana Education Trust Fund) is financed through a dedicated 2.5% VAT allocation to sustainably support tertiary education financing.
The Committee is expected to engage HELB on the accuracy of the Means Testing Instrument and provide details on the state of scholarships and bursaries disbursed by HELB per constituency.