HELB Penalty Waiver And Interest Rates 2021: Things You Need To Know

The Higher Education Loans Board (HELB) has been empowering the dreams of many students seeking to pursue higher education. Usually, the board offers them support in the form of loans.

Upon graduation, the beneficiaries are required to repay the loan with interest. Failure to repay may result in penalties. However, once in a while, the board announces a penalty waiver, which makes it possible to repay the loans.

The Kenyan economy is, arguably, not stable at the moment due to several factors. It has remained so for the past few years. This, in the long run, has affected many HELB beneficiaries’ abilities to repay their loans. Unfortunately, most of them are jobless because there are limited opportunities in the job market.

In 2019, parliament came to the aid of loan defaulters. It proposed to amend the HELB Act, preventing the board from imposing high fines on defaulters. Also, its proposal sought to reduce the interest rate from 4% to 3%. However, the government loaning institution strongly opposed parliament’s bid to cut the interest rate.

HELB Penalty Waiver

HELB penalty waiver is a relief measure intended to reduce the burden of loan defaulters. This approach entices them to pay their loans, allowing the board to sponsor other students to reach their dreams. For instance, in 2018, it offered a 100 percent waiver on penalties.

Like bank loans, HELB can punish those beneficiaries who fail to pay their loan on time. According to HELB Act 1995, section 15 (1) and (2),

A penalty of Ksh.5 000 will be levied for each month that has remained unpaid since maturity of the loan.

However, due to the increasing number of defaulters, the agency considered publishing university loan defaulters on Kenya’s leading dailies. This is among its measures of ensuring that the beneficiaries comply.

However, they are yet to do so. Perhaps, it is because many people opposed the approach. Previously, the Senate Education Committee had summoned Charles Ringera, the board’s executive boss, over the news.

In 2021, the agency is yet to announce a waiver. The same happened in 2020. The majority of those willing to repay have been eagerly waiting for the announcement. Essentially, the move will come in handy now that people are struggling because of the ailing economy.

How To Get A Penalty Waiver For HELB?

If you plan to clear your HELB loan balance, you can contact them or visit their offices for payment negotiations. It is advisable to have a discussion with them than going silent. Otherwise, your loan penalties will keep on growing.

You can also access the site to find out your current waiver and interest rate. Below is a guide on how to go about the process:

• On your browser, search for HELB.
• Proceed to the HELB portal.
• Enter your login credentials and click the “LogIn” button below.
• Once on the portal, navigate to “Online Services” then “Penalty Waiver Offer.”
• Select “Take this Offer” to proceed.
• You will be asked to choose your preferred payment method; for example, M-Pesa, credit, deposit, bank transfers etc.
• Click the “Submit request” option below to complete the process.
• Finally, you can click the “Print penalty waiver” button for a request slip.

Alternatively, you can access “Online Services” on the website by navigating to the “Main Menu” on the top right corner. However, at the moment, there is no news regarding penalty waivers on the “Announcement” section.

Now that you know how to calculate the HELB waiver, you should know that the percentage may vary from one year to the next. For instance, the HELB 80% waiver was applicable in 2014.

There is no specific formula for calculating the HELB waiver. In 2018, the board announced a 100% waiver. In other words, the HELB waiver calculation may change based on several factors.

HELB Interest Rates

Usually, the HELB interest rate is 4% per year. However, it can vary based on one’s education level, among many other factors. At the time of writing, the rate is 4% per year for undergraduate (direct entry), certificate, and diploma students. On the other hand, it is 12% per year for continuing students pursuing masters and PhDs.

In 2019, parliament wanted to reduce the rate to 3%. Also, the bill was seeking to remove the Ksh. 5,000 penalty. However, the proposal is yet to be discussed in detail by the legislators before it is passed. Also, the agency did not welcome the proposal.

Indeed, the HELB penalty waiver has helped many beneficiaries to repay their higher education loans. If you are yet to repay your outstanding loan, you can take advantage of this cushioning method to be debt-free. You can continue checking its website for the latest announcements to clear your HELB loan once the penalty waiver is available.

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