The Higher Education Loans Board (Helb) plans to borrow Sh22 billion through a bond to facilitate laptop purchases for students in the University.
Helb said on Tuesday it will issue its first of a kind social bond to supplement government capitation that has not been able to meet the pace of the growing student enrolment.
The rapid growth of the number of government-sponsored students in public universities in the past few years due to the lowering of the entry grade to public universities to C+, has overstretched the Agency’s funding from the State.
“In the beginning, our estimates were Sh5.5 billion. However, looking at the application of these funds, which is to finance students to acquire laptop loans for purposes of e-learning … we estimate this now at Sh22 billion,” said Helb CEO Charles Ringera.
“The current university intake is at 700,000. Only 20 percent of these students have laptops, leaving over 560,000 in dare need. At a unit cost of Sh45,000 for a good working laptop, then you can now see the actual demand – but we could start this progressively by issuing these in tranche notes.”
The Treasury and the Capital Markets Authority (CMA) have approved the plan to issue the bond. Helb is seeking a transaction adviser for the issuing of the bond, said it has secured a sovereign guarantee from the government for the bond.