Due to the National Treasury's budgetary cut in the aftermath of the financial crisis, at least 140,000 university students would miss out on this year's Higher Education Loans Board (HELB) money.

The National Treasury had allocated Ksh.14.8 billion against their aim of Ksh.20.5 billion, according to HELB.

It came as the board highlighted that the number of defaulters was increasing, harming other education system recipients.

HELB CEO Charles Ringera said almost 500,000 students sought the loans, but only 341,000 will profit from them.

Mr Ringera stated that the board received Ksh.14.8 billion, which was Ksh.5.7 billion less than their budgetary demands, implying that the number of recipients was reduced.

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"This year, our budget is approximately Ksh.14.8 billion to fund approximately 341,000 students." However, we have a demand of approximately 500,000 pupils, which implies we will not be able to meet the actual market," he explained.

"We have a shortfall of approximately 140,000 students for whom we have allocated zero for this year, hoping that next year will be better, all of which require approximately Ksh.5.7 billion."

He said that over 107,000 graduates need to catch up on their loan payments, with the number climbing around July each year.

The HELB CEO stated that the payback rates are currently at 68%, but the board is working hard to boost them to 76% by the end of the year.

"We will not say students have defaulted, but they are late making payments." Mr Ringera stated, "The current number of those who have delayed is approximately 107,000, and they carry approximately Ksh.8.7 billion."

He said universities across the country suffer from a financial crisis, which has hampered operations and service delivery.


He stated they are collaborating closely with counties and corporate groups to mobilize resources in response to the current financial crisis.

Mr Ringera spoke to the media in Naivasha following the introduction of the HELB Mobile Wallet Payment Solution, which would let university students collect their loans via M-Pesa.

He praised Safaricom for the collaboration, stressing that the application will make it easier to disburse and repay HELB loans to students.