The 3 Best Loan for Students in Kenya: All You Need to Know

Paydayloanskentucky.org – With a massive young population, the future of Kenya could be either dark or bright. It depends on how the country is run. When it comes to education, however, a loan for students in Kenya is a new issue that needs special attention.

Student loans can be a stepping stone. Those with a poor background can request a loan to pay for their tuition. This practice is common in countries like the US, UK, Australia, Germany, and even Japan.

However, studies prove that this phenomenon can result in huge student debt. Moreover, it’s a fact that fresh graduates often find it hard to repay the loan they take as they struggle to find a decent job.

Loan for Students in Kenya

Is Loan for Students in Kenya a Solution?

Kenya is quite new when it comes to student loans. To understand how student loans affect the population over the decades, we can look at the US’s situation.

According to a Pew Research study:

  1. 1/3 of American young adults have student debt
  2. Most student debts are owned by people who take a post-graduate degree
  3. Those who have student debts report that they struggle financially.

In conclusion, we can say that student debt can cause significant problems. Yet, another study reports that workers a higher degree have a chance to receive higher wages. Or in other words, in the long term, a student loan, without a doubt, can be beneficial.

What You Should Know about Loan for Students in Kenya

As for 2022, Kenya’s population is 12.7 million. Most of its citizens are under 35 years old. The economy is quite good. Surprisingly, it ranks third after Nigeria and South Africa.

Previously, it was common to find people who got a job without titles. But today, the situation is different. The young population has become more competitive. Consequently, it’s almost impossible to get a good job without a degree. That’s why the popularity of student loans in Kenya has risen.

Year0-14 Years15-64 YearsMore than 65 Years
201740.35%57.39%2.26%
201839.78%57.88%2.34%
201939.19%58.38%2.42%
202038.59%58.9%2.51%
202137.99%59.42%2.6%

Options for Loan for Students in Kenya

There are some institutions in Kenya that provide a specific program for student loans. The most famous ones right now are KCB Education Loan, Musoni Student Loan, and Higher Education Loans Board (HELB).

1. KCB Education Loan

The Kenyan Central Bank released its education loan to help the younger generation. The interest rate is 13% annually, with negotiation fee 2.5% and excise duty 20% of the negotiation fee.

In order for you to get it, you have to:

  1. Have an active account for at least 3 months
  2. Have a job or guardian to back you
  3. A Kenyan national
  4. Admission letter from a university or college

2. Musoni Student Loan

Musoni Kenya Limited offers a product called Tuelimike or School Fee Loan. The interest rates are varied, with the lowest being 1,8% monthly, while the upfront fee is 3% of the loan amount.

To apply for this loan for students in Kenya, the general requirement is the same with the KCB. You need to be Kenyan, have a job or parents to back you, and have been admitted by a university or college.

3. Higher Education Loans Board (HELB)

HELB is one of the most famous student loans in Kenya. The interest rate starts from 4% annually, although it can increase to 12% for master’s and doctoral degrees. To borrow from HELB, you need to sign up to their website first. Then, you should provide a copy of:

  1. Your national ID card
  2. Your parent’s ID card
  3. The admission letter
  4. The bank card
  5. The Smart Card
  6. Colored passport

Tips on Getting A Loan for Students in Kenya

  1. Choose the one with the cheapest interest rate and fee. The difference between one interest rate and the other can be as high as 3%.
  2. Select loans with a fixed rate. A loan with a variable interest rate looks cheaper at first, but it will increase over time.
  3. Pay the interest rate as early as possible.
  4. Do not borrow more than you need. The more you borrow, the higher the interest rate is.
  5. Look for the repayment program. The government might help you to pay back the loan.

Personal Loan for Students with No Job in Kenya

Getting a loan for students in Kenya can be difficult if we don’t have any job. Fortunately, some banks allow to do it as long as students have their parent to back them. In addition, there’s also a secured personal loan as another option.

A secured loan means that the debt is protected by collateral. At first, the lender will ask the debtor to inform them what asset will be used to back the loan. Students can use its personal belonging as a back whether the belonging comes from their parent or not.

Education Loans in Kenya to Study Abroad

Some young Kenyans might also have a dream of studying abroad. Getting a degree from abroad, especially from developed countries, is indeed promising. You can work in Europe or go back to Kenya to apply for an “expatriate” level job.

Nevertheless, the cost is obviously higher. Those who consider taking this loan should definitely study really hard so that they can finish their education with a good grade.

In brief, a loan for students in Kenya can be either a solution or a problem. Several banks and institutions offer specific programs to help the country’s young population. Yet, it’s important for the students to be careful and use the loan effectively.

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