NAIROBI, Kenya – Private universities in Kenya have called for sweeping reforms to the university funding model, proposing the creation of a single state agency to oversee student financing across both public and private institutions.
Through the National Association of Private Universities in Kenya (NAPUK), the institutions are advocating for the consolidation of key higher education funding agencies into the National Students Financial Aid Corporation (NSFAC).
The proposed body would manage student loans and research grants while sourcing additional funds from non-governmental sources, including education bonds and employer training levies.
Currently, under the New University Funding Model, students in private universities are only eligible for loans, while their counterparts in public universities receive both loans and government scholarships.
NAPUK argues that this system is discriminatory and should be replaced with an inclusive model that funds students in all institutions equitably.
“The steady decline in Differentiated Unit Cost (DUC) funding significantly contributed to the financial crisis in universities, prompting the introduction of the new model,” said Simon Gicharu, founder of Mount Kenya University, in a letter to Education Cabinet Secretary Julius Ogamba.
The call for reform comes as the government revisits the New University Funding Model after the High Court annulled it in December 2024, citing discrimination concerns.
In response, the government temporarily reverted to the DUC system, which has also struggled with funding gaps.
Initially designed to cover 80% of university education costs, DUC never met its target, peaking at 66.4% for public universities and only 18% for private institutions.
To ensure long-term sustainability, NAPUK proposes a shift from a social welfare approach to a performance-based scholarship system, limited to available government resources and aligned with priority programs.
The association also suggests that loan repayment structures be tied to graduates’ income levels to enhance affordability and recovery rates.
Furthermore, NAPUK recommends modelling NSFAC after South Africa’s National Student Financial Aid Scheme (NSFAS), which sources funding from the government, donors, and private contributors to support both university and TVET students.
NSFAS prioritizes 70% of funding for STEM programs and 30% for humanities and social sciences, an approach that NAPUK believes Kenya should adopt.
The proposal emphasizes the need for an efficient loan recovery system and a robust information management framework to track students’ financial backgrounds and project budgetary needs more accurately.
The association suggests leveraging national administration officers and education ministry officials to enhance the monitoring process.
With legal challenges forcing a reassessment of university funding, private universities see an opportunity to establish a more equitable and sustainable financing structure that benefits both students and institutions.
“Students should repay loans based on their income, ensuring recovery is fair and adaptable to beneficiaries’ financial situations,” NAPUK stated.
The Ministry of Education is expected to review the proposal as it refines the country’s higher education financing strategy.
