The country is staring an effective student debt crisis in the short run as Kenyan university students bear considerable weight of loan repayments.
Available data paints a grim picture of the impending doom as the majority of college graduates run into major headwinds including unemployment and poor remuneration at work.
The closing walls on students and recent graduates come as the Higher Education Loans Board (HELB) seeks to recover Ksh. 10.7 billion from 85,211 individuals with due repayments going as far back as 1975.
According of the national student debt data base shared to Citizen Digital by HELB, an estimated 927,610 students have benefitted from the historical disbursement of over Ksh. 108 billion with 492,227 loan accounts worth Ksh.58.5 billion having matured so far.
At the same time, 435,383 loan accounts amounting to Ksh.49.5 billion are yet to fall due and represents beneficiaries who are still undertaking their studies or graduates within the one year grace period ahead of the start to repayments.
As such, the student loan book is still performing at a commendable rate of 70 percent but the longevity of its quality remains shrouded in doubt owing to a burgeoning count of unemployment.
According to a 2016 World Bank report, one out every five Kenyans aged between 18 and 34 are unemployment to represent an average jobless rate of 17 percent which nearly triples that of neighboring Uganda and Tanzania.
Presently, a projected 800,000 students graduate out of tertiary institutions every year to represent an injection of a 4.5 percent of the country’s entire workforce as per government data at the end of 2018
An estimated 160,000 graduates are hence unable to acquire job placements year over year to be added onto the millions of other job seeking Kenyans.
At the same time, perennial job losses under the continued stay of depressive economic environment remain prevalent as the majority of firms turn to automation to lock out thousands of job-seeking youths.
Recent graduates are therefore unable to fend for themselves to elevate the rate of student loan defaults in the country in spite of willingness to make repayments.