The Higher Education Loans Board is owed Sh9.5 billion by past beneficiaries, making it hard to meet the demands of financing higher education.
To enhance repayment, the board has issued a one-month amnesty to defaulters willing to pay in lump sum to clear their dues.
The board is also betting on the ongoing political activities to recover hundreds of millions since those aspiring for various seats must seek clearance with it before getting the greenlight to contest.
HELB chief executive Naftali Michira said that heeding the offer will see a loan beneficiary enjoy 80 per cent penalty waiver.
He said that in the past year they recovered up to Sh3.99 billion. “The amnesty is up to 80 per cent penalty waiver for anyone whose account has attracted penalties. This waiver is on condition that a lumpsum payment is made,” the board said.
It added that it has financed education of 650,000 Kenyans since inception, but 85,000 beneficiaries have declined to pay their loans.
Mr Michira said strict compliance to enforcement by corporate firms, private companies and State agencies had helped them improve repayments from a paltry Sh5 million realised in 1995/1996 financial year to Sh3.99 billion in the just-ended 2015/2016 period.
The CEO advised beneficiaries to write to HELB officials requesting for a status report, which will show the accrued amount and the expected payment after the waiver.
HELB has in the past put in place stringent measures to recover the arrears.
Aspirants for political office, people seeking public employment and motorists renewing their driving licences must seek clearance from the board.
Mr Michira said they had also started pursuing guarantors in a bid to compel them to intervene and have the loans cleared, with a threat to seize the property of guarantors if this is not done.
HELB said it had recovered Sh12.3 billion from 159,997 Kenyans by March 2017, while another 132,233 beneficiaries were servicing their loans valued at Sh19.8 billion.
If successful, HELB could enjoy a windfall since the political field has attracted thousands of candidates.
This could help the board meet its 2017/2018 target of Sh20 billion to execute its expanded mandate of financing education for students undertaking certificate, diploma and degree courses at middle level colleges and universities.
This year, HELB received Sh2.5 billion loan from the government and a further Sh6.6 billion allocation from the Treasury.
To track down defaulters, HELB has brought on board the Kenya Revenue Authority and blacklisted defaulters, whose names were forwarded to credit reference bureaus, thereby blocking them from accessing credit from financiers.