Higher Education Loans Board (HELB) beneficiaries have been hooked by the friendly proposals in the Building Bridges Initiative (BBI) on repayment terms.
According to the document that was presented to President Uhuru Kenyatta on Wednesday, October 21, BBI proposed that the grace period given to the beneficiaries before they are expected to make payments be extended to four years from the date of completing their studies.
The report also suggested that graduates be allowed to request exemptions from repayment until they secure jobs.
“The amendment seeks to give loanees a grace period of four years from the date of completion of their studies. After this, they can commence repayment of loans advanced to them.
“Further, it amends the Act to exempt loanees without a source of income, upon application to the Board, from paying interest on the loans advanced to them, till such time when the loanees shall start earning an income,” read the statement in part.
The Bill seeks to amend the Higher Education Loans Board Act, 1995 that only accorded the students a window period of one year after completion of studies.
In February 2020, beneficiaries of the fund were up in arms protesting what they termed as punitive terms.
In 2019, the tiff between the board and loan defaulters hit dire levels forcing the body to threaten to publish the photos of defaulters in daily newspapers.
“Please take note the names and pictures of HELB loan beneficiaries who have defaulted repayment of the loan from 1975 to date shall be published in the leading newspapers,” read a notice from the body at the time.
HELB also noted that the funds received from loan repayment were used to support the current needy students, therefore, ‘sustained default hinders funding of other deserving Kenyan youth.”
In retaliation, some desperate defaulters dared the loans board to go ahead and publish their photos and names in the dailies.
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They argued that unemployment in the country was on the rise and made it difficult for them to consistently remit the charge on a monthly basis.
The burden is compounded by the Sh5,000 fine that HELB imposes for every month that a loanee fails to make a service payment for the loan.
Since the Covid-19 pandemic hit the country, it is estimated that over five million people lost their jobs.