President Uhuru Kenyatta stepped in to help beneficiaries of HELB (Higher Education Loans Board) funds after refusing to sign the Higher Education Loans Bill (2020).
Uhuru, who refused to sign the bill on Tuesday, June 21, at the Nairobi State House, returned it to Parliament with a memorandum citing strict clauses in the bill that would give Helb power over borrowers.
According to the document, the bill amends Section 15 of the Helb Act to allow the board to withdraw the loan before the one-year grace period expires.
In accordance with this, it asked the beneficiaries to provide the body with their contact information.
“A borrower must, within one year of completing his studies or within a period in which the Council decides to withdraw the loan, whichever comes first, to inform Helb of his contact address,” reads part of the draft of law.
The proposed law required students who had outstanding loans to start serving them within one year of completing their studies, including interest on payments.
Undergraduates who find work within the same time frame should instruct their employers to make Helb deductions and remit them to the parastatal. Failure to do so would result in significant penalties.
A borrower who fails or fails to meet the requirements within the stipulated time limit would be guilty of a criminal offense and liable to a fine of not less than Ksh5,000 in respect of any loan deduction that remains unpaid under subsection 1, and such the fine would be paid to the Council.
The bill was rejected after the Council said it was underfunded due to unpaid loans. On May 22, Helb CEO Charles Ringera announced that 75,000 students who rely heavily on state funding could be denied the funds.
Ringera explained that 107,000 beneficiaries, including those who left the country for better opportunities abroad, defaulted on loans totaling nearly Ksh 10 billion.
He went on to say that the council would follow the law and fine unserved accounts.
Helb announced a 100% waiver on fully paid loans by June 2022 to encourage credit service.
Uhuru also refused to sign the ICT Practitioners Act.
The bill sparked outrage over its stringent requirements, including one requiring industry players to keep it.
