Kenya's HELB would be replaced by a new funding authority if MPs pass tertiary funding Bill

The Higher Education Loans Board (HELB), Kenya's state student lender, would be replaced by a Tertiary Education Funding Authority (TEFA) if Parliament passes the Tertiary Education, Placement and Funding Bill, 2026. The Bill repeals the HELB Act. It is not law: it passed its first reading on 11 August and is with a parliamentary committee.

Clause numbers and wording below are as quoted or summarised by the Kenyan news site Pulse Kenya on 12 August 2026; Education News, another Kenyan news site, set out the Bill's financing proposals on 13 August.

TEFA would take over from HELB, the Universities Fund Board and the Technical and Vocational Education and Training (TVET) Funding Board. Existing loans, assets, liabilities and staff would move to the successor bodies.

Placement would change too. The Kenya Universities and Colleges Central Placement Service (KUCCPS), which assigns students to courses after secondary school, would place students for all tertiary institutions. Public institutions come first, and a student goes to a private one only on request where no public vacancy exists. Clause 20(5) says funding "shall only be for students who have been placed by the Placement Service".

On money, clause 46(1) says every student or trainee admitted to a public or private tertiary institution "shall be eligible for an education loan". Applicants must be Kenyan citizens, and eligibility does not guarantee a loan. Clause 47 lets an eligible person apply for a loan on behalf of a minor who has been admitted. Scholarships would exist, but loans would make up the larger share.

The interest rate is not in the Bill. The Authority would set it in consultation with the Cabinet Secretary. Repayment would start within one year after studies end, and clause 49(4) says deductions from a loanee's pay must not exceed 25 per cent of emoluments. Employers would have to remit deductions within nine days after the end of each month, with a 5 per cent penalty on the unpaid amount for each month it stays outstanding.

Ministry of Education officials described the financing to the National Assembly Education Committee separately from the Bill's text. Citizen Digital reported on 6 August that the plan ring-fences a KSh 100 billion annual government grant, made up of existing allocations: KSh 56 billion for HELB, KSh 30 billion for the Universities Fund and KSh 9.6 billion for TVET scholarships. HELB chief executive Geoffrey Monari said that after three years HELB could move to concessional loans at roughly 1 per cent to 3 per cent interest, with a 10-year grace period and repayment over 30 years, and that HELB would borrow from the commercial sector through a bond programme.

Student groups object. Vivian Mureithi, vice president of the Student Organisation at the University of Nairobi, said on 22 September that a shift from scholarships to high-interest loans amounted to an attempt to kill tertiary education. "We reject this in totality," she said, as quoted by the Somalia-based news site Dawan Africa.

The Bill has passed its first reading and sits with the National Assembly Education Committee, chaired by Julius Melly. The committee's public hearings on this and five other education Bills ended on 2 October after reaching all 47 counties (Education News, 4 October). The committee is expected to retreat to consider the submissions and then write its report; the Bill then goes to Second Reading and Committee Stage.

For a family paying for university this year, HELB is still the lender named in the Treasury's budget. Treasury Cabinet Secretary John Mbadi presented the 2026/27 budget on 11 June 2026. The HELB allocation is KSh 56.3 billion, up from KSh 41.5 billion in 2025/26 (The Star). That is the sum set aside in the budget, not money paid out to students.

Education News reported on 2 September that Higher Education Principal Secretary Dr Beatrice Inyangala urged universities to admit first-year students while the Bill is pending. "The students should join universities as we wait for the processing of the bill," she said. She added that parents and guardians would get clear guidance once the Bill is finalised.

Citizen Digital reported on 2 September that some first-year students who had reported to universities had received no loan or scholarship disbursement. In an update on 8 October, HELB said five loan batches "have been processed and disbursed to institutions"; it gave neither the amount nor the number of students covered (The Star). Kenyans.co.ke, a Kenyan news site, wrote on 15 October that first-year students had faced processing delays linked to late issuance of national identity cards and to mismatches between examination index numbers and identity details on the Higher Education Financing (HEF) portal.

No date has been announced for the committee's report or the vote. The National Assembly goes into recess after its sitting on 22 October and resumes on 3 November.