The Higher Education Loans Board (HELB) has announced a raft of new penalties targeting employers and loan beneficiaries who fail to comply with student loan repayment regulations in a renewed push to recover billions in outstanding debt.
In a statement issued on Friday, March 20, the loans board said employers who do not declare employees with HELB loans or fail to remit the required deductions will be fined Ksh3,000 per employee per month.
HELB added that the penalty will be backdated to the employee’s date of hire, a move likely to significantly increase liabilities for non-compliant firms.
The board said the enforcement measures form part of a broader strategy to recover more than Ksh100 billion owed by past beneficiaries.
At the same time, individuals who have defaulted on their loan repayments will face a monthly penalty of Ksh5,000, further tightening the noose on defaulters.
According to HELB, more than 20,000 companies and approximately 360,000 loan beneficiaries are currently in default, highlighting what it described as widespread non-compliance with a 2025 directive on loan recovery.
The directive placed responsibility on employers to support repayment efforts by submitting employee records for verification, deducting 15% of salaries from staff who benefited from HELB loans, and remitting the funds directly to the board.
However, HELB noted that most employers have yet to comply with these requirements.
The board maintained that there are no plans to write off unpaid loans, saying it is committed to recovering funds to sustain financing for future students.
To enhance compliance, HELB urged employers to utilise its Employer Portal, which facilitates registration, reporting of loan beneficiaries, processing of deductions, and remittance of payments through approved channels.
