Payslip raid: How HELB plans to recover student loans from salaries

The Higher Education Loans Board (HELB) is taking action to recover student loans by deducting repayments from the salaries of borrowers in formal employment. However, the specific amount deducted varies for each individual based on their repayment schedule and outstanding loan balance, rather than a fixed monthly rate. Once graduates secure a job, their increased income may lead to the beginning of loan repayment deductions on their payslips.

HELB offers two repayment methods: through an individual payment or an employer's check-off system. In the employer arrangement, the company deducts the specified amount and sends it to HELB. Borrowers need to understand their repayment schedule before assuming a constant amount will be deducted from their salary, as each borrower's deduction rate may differ.

HELB provides loan borrowers with an outstanding balance and monthly deduction rate via its employer portal, or borrowers can request a billing schedule directly from the Board. The Board recommends a minimum monthly payment of Ksh1,500, but this is not a universal deduction for all employed borrowers. Employers must disclose employees with HELB loans, make the required deductions, and remit the funds to the Board by the 15th day of the following month.

Borrowers should regularly monitor their repayment statement and billing schedule to ensure accurate deductions. If an employer stops deducting HELB repayments, it does not mean the loan is cleared, and borrowers must continue to monitor their statements and contact HELB for clarification. Defaulting on repayments can result in penalties and enforcement measures, including listing with credit reference bureaus.

Therefore, maintaining timely repayments is crucial to avoid penalties and ensure the funds can be used to finance other students.