Loan defaulters get relief as HELB announces 80% penalty waiver

The Higher Education Loans Board (HELB) on Monday announced an 80 per cent waiver on penalties for loan defaulters who choose to clear their outstanding debts in full.

The move is aimed at easing the financial burden on beneficiaries who have fallen behind on their repayments.

In a notice, HELB urged defaulters to take advantage of the waiver by reaching out to the board through its available communication channels.

"Settle your HELB Loan in a lump sum and enjoy an 80 percent waiver on accrued penalties. Simple, rewarding, and just a call, DM, or email away!" the statement read.

The notice did not specify when the offer would expire, leaving borrowers with an open window to make arrangements for repayment.

HELB has introduced similar waivers in the past to encourage compliance among loan beneficiaries.

In March 2022, the board granted a 100 percent waiver on penalties to cushion borrowers struggling with the economic hardships that followed the Covid-19 pandemic.

Initially set to last one month, the waiver period was later extended by two more months, ending in June 2022.

At the time, HELB Chief Executive Officer Charles Ringera explained the decision, noting the impact of the pandemic on the economy.

"Due to the Covid-19 pandemic, Kenya just like many other countries globally has experienced a slowing down of the economy over the last two years," part of the statement read.

"We acknowledge that unemployment and underemployment as well as a challenging environment for loanees to start and run businesses, has affected HELB loan repayment," it read further.

A similar 100 percent penalty waiver was also introduced in 2018 to encourage lump sum repayments and improve compliance.

These initiatives are part of HELB’s continued efforts to recover outstanding loans from thousands of former students who have defaulted.