No End In Sight For Unemployed Graduates Trapped In HELB Loan Burden
For some Kenyan graduates, pursuing higher education has become a double-edged sword rather than a path to a bright future.
The burden of debt has imprisoned students who used money from the Higher Education Loans Board (HELB) to finance their college and university degrees as the lack of employment chances in Kenya looms.
They borrowed money to pay for their schooling in the hopes that the classes they studied would help them succeed in the fiercely competitive job market.
“I graduated in 2021 from Masinde Muliro University of Science and Technology where I studied finance and business economics.Sincerity be told, this training hasn’t been of any assistance to me. Ferdinand Ng’ethe, a young Kenyan in Nakuru, claims, “I have been pushing for a job, but to no avail. I have chosen to explore greener pastures abroad.
Despite taking the school’s suggestion to take the CPA to increase your chances of finding a job after graduation, Ferdinand continues, “I still didn’t get lucky even having obtained all the certifications.
Despite their qualifications and commitment to achieving financial independence, they are unable to endure the burden that student loan installments add to their already onerous quest for economic security.
“Throughout my four years on campus, I relied on HELB. My parents’ tuition burden was lessened in part thanks to HELB’s partial payment of my education expenses. Mwaura Kelvin, a resident of Mombasa, says, “I still struggled since the amount I applied for with the Higher Education Loan Board and the amount I received, wasn’t at all what I’d hoped for.
Mwaura describes how a HELB debt he obtained while an undergraduate has turned into a significant financial burden.
Even with the HELB, the hardship of the tuition fees increased as I entered my second year. I also had to deal with pressure from the school to pay the entire tuition amount before taking tests. He continues, “There was also the worry that I might not be able to graduate because of gaps in my transcripts from late fees payments.
A finance expert, Kiyai Eston, claims that large loans and unemployment have long-term effects, trapping recent graduates in a vicious cycle of unemployment and leading to some of them defaulting on their loans due to a lack of financial security.
“Due to the economic downturn and a lack of work, many students who graduate from college today are unable to make their student loan payments. This has significant ramifications because it cripples the money intended to support new and incoming students, according to Kiyai.
In order to lessen the burden on unemployed graduates, the finance expert believes that the government should impose policies that would correct the issue.
The amount of money given to these students and the amount that must be repaid should be balanced, he argues, according to the Higher Education Loan Board.
“While many universities are directing graduates towards the job market, no industries are able to take them on. Due to numerous taxes and other factors that make it difficult for businesses to survive, there is also a hostile business environment. There may be many students who are prepared to pay their loans but there are no jobs or businesses, thus there is no revenue.
Also Read: HELB Amendment Bill Offers Hope to Graduate Beneficiaries
The scenario, says Kiyai, might push the nation into a worsening economic catastrophe if it is not addressed.
“The manufacturing, entrepreneurial, and innovation sectors, as well as the digital economy, should play a significant part in creating job opportunities for graduates so they can repay their loan facilities.” Because you cannot have a population that is unemployed and not producing any income, if we don’t act now, the economic situation may worsen, warns the financial expert.
No End In Sight For Unemployed Graduates Trapped In HELB Loan Burden
Through targeted investments in industries with high growth potential, the encouragement of an entrepreneurial ecosystem, and the creation of an environment that supports job creation, the government needs to start making policy changes and interventions that could ease the student debt crisis and increase employment opportunities.
“Even though I knew I would pay the HELB loans off on my own in the future—and since my annual payout was only ksh40,000—I nevertheless applied for them every year. As a result, the loans have already totaled over ksh200,000. I am currently having trouble paying it, “Maura continues.
By the end of the four years, you’ll have accrued a sizable debt that you’ll have to settle. Given the lack of employment opportunities and the current state of the economy, this debt is a particularly burdensome one, Mwaura continued.
The shortcomings of the educational system, the mismatch between skills and market demands, and the expanding gap between academic credentials and real-world experience are some of the main reasons of this issue.
