Draw up a sustainable student loans plan – Business Daily
Student loan beneficiaries at Helb offices in Nairobi. FILE PHOTO | NMG
The Higher Education Loans Board (Helb) has done well to cut the outstanding amount in repayment defaults by a fifth in the past six months. But attention must now turn to improving the sustainability of the revolving fund through which thousands have accessed tertiary education.
Last month, the High Court barred the loans body from imposing penalties exceeding the principal amount owed by a borrower, which was seen as a key deterrent to defaulters who risked being saddled with debt several times their original benefit.
That being said, Helb must build on the positive momentum of the recoveries seen this year, which have partly been helped by a penalty waiver that encouraged many to come forward and clear their outstanding dues.
The long-term solution though lies in diversifying the funding streams of the body, starting with the proposed social education bond that is to target Sh5 billion.
Formulating forward-looking plans, rather than remaining fixated on outstanding defaults and delayed Treasury disbursements, will ensure that the body plays its role in facilitating higher education fully.