The Higher Educations Loans sources in Kenya KNEC KCB Masomo Loan, HELB

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Education Loans


An education loan is meant to help students pay for general education (secondary and primary school) but mostly university tuition, books, and living expenses. It differs from other types of loans in that the interest rate may be substantially lower and the repayment schedule may be deferred while the student is still in education. It also varies from country to country within the laws of the country. Within the various countries, the loan varies from different institutions offering the education loan for example in Kenya we have the Higher Educations Loans Board which offers loans to needy students who passed and qualified for Universities but are unable to pay their fees and expenses while at campus.

Education loans are also offered at Sacco’s, banks and other micro lending institutions.


Education Savings Scheme (ESS) Loans

Education is perhaps the most critical and largest borrowing needs that majority of Sacco members have. Many Saccos therefore experience the greatest demand for loans around the back-to-school period. It is in this respect that Co-op Bank decided on coming up with a variety of solutions to assist Saccos serve their school fees-paying members better particularly during these peak periods.

The Education Savings Scheme is designed to encourage Saccos to save towards building a reserve fund which is to be applied as collateral to secure their borrowing from the Bank for on-lending to members for school fees, hence the name ‘Education Savings’

Loans for College

What kinds of loans are available for college education in Kenya?

KCB Masomo Loan

Kenya Commercial Bank-KCB launched a loan product for students, aimed at bridging the increasing gap in financing of tertiary education in Kenya.

KCB Masomo Loan, the first of its kind in Kenya, is the product of a partnership between the bank and Higher Education Loans Board (HELB) targeting those pursuing undergraduate and post graduate studies in accredited universities in Kenya.

This was established to enable working class students undertaking graduate courses in all private and public universities, the enables them to borrow up to KS 300,000.

KCB aims to provide direct funding to students, parents and guardians of both private and public universities subject to their ability to repay the loans. Loan repayment will be through a check-off system and will be based on the cost of the education program. Applicants can borrow up to KShs300, 000 repayable within a maximum period of 24 months subject to the duration of the programme. The loans will attract an interest rate of 2 percent above base rate, which at the moment stands at 15 percent.

Successful applicants benefit from KCB’s expansive network across the country and low interest rates and need not to have an account with KCB.

Other benefits accrued include an insurance cover in the event of death and quick processing period of the loan. In addition, top-ups on loans are available to borrowers who have repaid 25% of the principal loan amount.

IFC Loan

IFC, a member of the World Bank Group, is partnered with Commercial Bank of Africa Ltd and Strathmore University in Kenya to introduce a new student loan product. This has helped reduce the financial burden on students at the university, including those from lower- and middle-income families who are eligible to attend university but cannot pay the entire tuition costs upfront.

Kenya has seen a growing demand for tertiary education, with a steady rise in enrollment and an increase from three private universities. A quarter of eligible applicants are denied admission because they are unable to pay tuition upfront.

The Commercial Bank of Africa is managing the overall program, which consists of a 280 million Kenyan shillings ($4.5 million equivalent) portfolio. Strathmore continues to contribute funds to cover potential initial losses on the loan portfolio, and IFC provides a structure to reduce the remaining risk. The loans are priced at 12 percent a year and cover annual tuition. Repayments are made in equal monthly installments over a 12-month period, enabling students to meet annual tuition costs. The loans also provide the university with a stable flow of funds.

The Higher Educations Loans Board

The Higher Education Loans Board of Kenya (HELB) helps those looking to attend college or university in Kenya, by providing financing in the form of affordable loans and scholarships.

The majority of the financing was in the form of scholarships, but as more and more people sought education, the system was unable to keep up with the monetary needs.

So the University Students Loans Scheme was put into place, to allow for loans rather than scholarships.

The loans are available for undergraduate studies, as well as for postgraduate education. Loans for Masters and Doctorate studies are limited to 200 each year and they are awarded on academic merit, not monetary needs.

Applications are accepted each year during the final calendar quarter, usually between October and December for the next academic year. Loans are to be repaid one year after studies are completed. 


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