The Higher Education Loans Board (HELB) has announced an open tender for debt collection services to recover funds from defaulting beneficiaries as the government agency continues to struggle with a funds squeeze.
Through an advertisement published in MyGov, HELB disclosed it was looking for qualified service provider to provide debt collection services for a period of two years.
Interested and eligible firms have until October 1 to submit their applications, which can be submitted by downloading the tender document from the HELB official website.
“HELB invites interested, experienced and reputable debt collectors to submit their closed tenders,” the statement read in part.
Photo of students lining up to submit their HELB details at Anniversary Towers in Nairobi County.
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Bidders are also supposed to notify HELB of their participation in the tender process by sharing their firm’s email address and other details to procurement@helb.go.ke in case there is a need to be contacted.
The HELB fund is supposed to work on a revolving basis, where beneficiaries who are done with their vocational training are supposed to pay back to support a new group of students.
This, however, has not been the case in recent years, with harsh economic times forcing beneficiaries to default.
Defaulting of HELB loans by beneficiaries, coupled with other factors, has negatively affected the institution’s financial muscle and ability to adequately cater for needy students seeking higher learning.
According to Mount Kenya University (MKU) Pro-chancellor Dr Vincent Gaitho, government allocation per student sponsored by the state in private universities dropped from Ksh70,000 to Ksh40,000 in just eight years.
In the financial year 2023/2024, HELB funded 606,329 students at a total cost of Ksh 33.45 billion. This brought the total number of beneficiaries of the fund to 1,696,781 since the program’s inception.
By the end of the 2023/2024 financial year, HELB revealed that 986,674 loans, amounting to Ksh 127.81 billion were due for collection and subject to recovery efforts.
In an attempt to recover the loans from defaulting borrowers, HELB has attempted several approaches like communication and outreach, providing incentives and offering flexible repayment plans.
HELB announced in June 2024 that there was a new application portal for the 2024/2025 academic year under the new funding model.
One of the more controversial aspects of the new funding model is how funds will be disbursed. Instead of higher learning institutions receiving block funding in the form of capitation, student loans will be through scholarships and household contributions.
University students accessing HELB services.
The Standard
