The Higher Education Loans Board (Helb) has written off Sh55.6 million despite struggling to recover Sh7.7 billion from former students.
The agency says it has been forced to write off the Sh55.6 million after it established that 653 beneficiaries have since passed on with the money now adding to its growing pool of bad debts.
Out of the deaths, 110 beneficiaries were killed in the April 2015 Garissa University terror attack that claimed 147 people, leading to a Sh7.82 million loss to Helb.
The Garissa University victims accounts for 14 percent of Helb’s death-linked losses.
The higher education financier has already indicated that it may not be able to provide loans to over 113,953 eligible students citing cash crunch.
The agency whose student funding budget for the year to June stands at Sh15.5 billion had hoped to recover Sh4.9 billion from past loanees.
Over the past 24 years, the Helb has financed the education of more than 946,000 students in universities and Technical and Vocational Education and Training (TVET) Colleges.
“During the last 24 years, Helb has disbursed over Sh110 billion,” said Helb chief executive Charles Ringera in a statement.
The agency maintains that, loan defaulters have weakened the agency’s ability to support university freshers and continuing students, prompting allocation cuts.
The agency said it is currently in pursuit of some 78,328 loan defaulters holding Sh7.7 billion as at 31 December last year.
Beneficiaries are expected to start repaying one year after completing studies. The HELB Act of 1995 does not peg loan repayment to employment.
additional info: BusinessDaily
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