A degree on credit: Why Kenya’s new university funding model could shape the future of an entire generation
The Mt Kenya Times 
The shift from grants to loans is forcing a hard national conversation about what happens after the graduation square
By Hadassah Karangu
For generations, a university education has been regarded as one of the surest paths to success. Parents have sacrificed savings, sold livestock and borrowed money so their children could sit in lecture halls and reach for a brighter future. A degree has always represented more than an academic qualification — it has symbolised hope, opportunity and the promise of a better life. Today, however, that promise is being tested.
Kenya’s university funding system has undergone a significant transformation. Under the new model, many students now rely more heavily on loans than grants. The government argues the reforms are necessary for sustainability and fairness, but students, parents and education stakeholders remain deeply concerned about the long-term consequences. The debate is no longer simply about paying university fees. It is about the future of an entire generation.
The biggest worry is straightforward: many students will complete their studies carrying larger education loans than ever before. Unlike grants, loans become a financial obligation that follows graduates into the next chapter of their lives — and that reality grows more troubling when set against Kenya’s unemployment challenge.
Every year, thousands of graduates leave university full of ambition and confidence. Unfortunately, the labour market tells a different story. Many spend months searching for work. Others spend years. Some eventually settle for jobs unrelated to their studies; many remain unemployed despite possessing the qualifications employers say they want. The question therefore demands to be asked: if graduates cannot secure employment soon after completing university, how will they comfortably repay the loans they accumulated while studying?
This concern dominates conversations among students across the country. Graduates are expected to begin repaying education loans after a relatively short grace period. For many young people, that window closes fast. Some are still completing internships. Others are volunteering to gain experience. Many are still attending interviews without landing stable work. Beginning loan repayments during such financially uncertain times could become an enormous burden.
For those who do secure employment, monthly deductions may leave little room for rent, transport, food and family obligations. For those who remain unemployed, the pressure could be even greater. Instead of entering adulthood with the freedom to save, invest or start businesses, many graduates may find themselves focused first on settling education debts. For a country that champions innovation, entrepreneurship and youth empowerment, that raises an important policy question: can young people truly build wealth if they begin adult life carrying significant financial obligations before establishing stable careers?
The reduction in grant funding adds another layer of concern. Grants once played a vital role in ensuring students from disadvantaged backgrounds could access higher education without accumulating excessive debt. With fewer students qualifying under the new system, many families worry that university may become increasingly out of reach for vulnerable households. Parents already struggling with the high cost of living now fear their children will graduate with debts that could take years to clear.
Students are equally anxious. Some question whether certain degree programmes are financially worthwhile if employment prospects remain uncertain. Others fear that financial pressure may discourage talented young people from pursuing higher education altogether. Access to university has expanded considerably over the years — but if the cost of a degree becomes a barrier for students from low-income families, much of that progress risks being undone.
The government has introduced initiatives such as Jielimishe, which aim to provide additional financing for learners pursuing higher education and further studies. Supporters believe such programmes can open doors for students who might otherwise be unable to continue — particularly those seeking postgraduate qualifications or professional development. Access to financing matters. But financing alone cannot solve the broader challenges facing higher education.
Funding reform must be accompanied by policies that create employment opportunities. A country cannot continuously produce graduates without expanding the economy’s capacity to absorb them into meaningful work. Without job creation, education loans risk becoming financial burdens rather than investments in the future. The conversation must therefore move beyond how students pay for university. The real discussion should focus on what happens after graduation.
Will graduates find jobs? Will the economy generate enough opportunities? Will employers absorb the thousands entering the labour market each year? Will loan repayment systems remain flexible enough to accommodate graduates facing unemployment or low incomes? These are the questions that deserve urgent national attention.
A successful university funding model should not simply ensure students enter university. It should position them to leave with dignity, confidence and realistic opportunities for success. Education is an investment in human capital — it should empower young people to contribute to national development, not leave them overwhelmed by financial obligations before they have had the chance to build their lives.
Kenya’s future depends heavily on today’s students. The doctors, teachers, journalists, engineers, lawyers, scientists and entrepreneurs currently sitting in lecture halls will shape the country’s economy tomorrow. They deserve a funding system that not only supports them while they study but also protects their transition into the world of work.
Policymakers have an opportunity to listen — to students, parents, universities and employers alike. The goal should not merely be balancing government budgets. It should be building a system that gives every deserving student a fair chance to succeed without turning education into a lifelong financial burden.
A university degree should remain a ladder to opportunity, not the starting point of years of debt and uncertainty. Kenya’s future will not be determined solely by how many students enrol in universities. It will also be determined by what kind of lives those graduates are able to build once they walk out of the graduation square and into the real world. Education should inspire hope, not fear. It should unlock opportunities, not create barriers. Striking the right balance between access, affordability and sustainability will determine whether the dreams of today’s students become tomorrow’s success stories — or tomorrow’s financial struggles.
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