Tanzania is allocating nearly three times more per university student than Kenya, highlighting a stark contrast in higher education financing strategies in East Africa. The Higher Education Students’ Loans Board (HESLB) of Tanzania has set aside Sh926.7 billion ($377 million) for roughly 273,347 students for the 2025/26 academic year. In comparison, Kenya’s Higher Education Loans Board (HELB) and government scholarship programs are supporting over 695,000 learners with Ksh 41.2 billion (~$314 million).
The disparity is not just a reflection of student numbers but a result of fundamentally different funding philosophies. Tanzania focuses on providing comprehensive support to a smaller cohort, while Kenya spreads resources across a broader population using an income-based “banding” system that limits per-student loan amounts.
Tanzania Expands Access Amid Rising Demand
HESLB’s 2025/26 budget targets 239,331 bachelor’s students, including 81,079 first-years and 158,252 continuing students. The board also reintegrated 7,776 continuing students who had missed loans due to incomplete applications or prior budget constraints, costing Sh22.8 billion.
Diploma financing, introduced in 2023/24, rose sharply in 2024/25, with Sh23.9 billion allocated to 9,144 students across 177 participating institutions, up from 54 the previous year. At the postgraduate level, HESLB allocated Sh1.4 billion for 308 new students, including 88 master’s and 20 PhD candidates, plus Sh806.4 million for continuing students. The system also extended loans to public servants in STEM fields and students at the Law School of Tanzania.
A key feature of Tanzania’s model is the Samia Scholarship, which provides full grants for high-performing STEM students. This approach ensures that critical skills for industrialization and innovation are funded without burdening top talent with debt.
To improve sustainability, HESLB is moving toward a revolving fund model. From 2025/26, applicants must provide a National Identification Number (NIN), strengthening tracking and repayment enforcement. Loan recovery is reinforced by mandatory 15% deductions from public-sector salaries, while private employers are required to cooperate in repayment reporting.
Kenya’s Student-Centred Funding Model
Kenya’s HELB operates under a mixed funding model combining government scholarships, student loans, and household contributions. Under the Student-Centred Funding Model (SCFM), students are classified into five income-based bands using a Means Testing Instrument (MTI). Funding is split among government scholarships (30–70%), HELB loans (25–30%), and household contributions (5–40%), depending on the band.
The system allows Kenya to reach a larger number of students but results in smaller per-student allocations. Many students in higher bands receive minimal upkeep loans, as low as Ksh 15,000–20,000, while larger government funds are disbursed through the Universities Fund as non-repayable grants.
HELB recovered Sh6.2 billion in 2025, up from Sh5.2 billion in 2024, but still faces a projected Sh35 billion deficit for 2025/26. Delays in second-semester disbursements in January 2026 triggered unrest among students. The banding system has also faced public and legal scrutiny over fairness in classifying “needy” learners. To reduce reliance on the exchequer, Kenya is exploring alternative funding sources, including social bonds and private investment schemes.
Why Tanzania Spends More per Student
Tanzania’s higher per-student spending is driven by several key factors. The HESLB provides comprehensive coverage that includes tuition, accommodation, meals, books, and research costs for qualifying students. In contrast, Kenya limits loans for students in higher income bands and channels larger amounts through separate scholarship programs, resulting in smaller per-student loan allocations.
The structure of the funding also contributes to the difference. Tanzania’s Sh926.7 billion allocation is a consolidated fund, covering both tuition and upkeep in a single pool. Kenya, by comparison, splits its Ksh 41.2 billion between loans and scholarships, which makes the portion available as repayable loans appear smaller.
Tanzania relies heavily on government funding, with 73% of total financing coming from the exchequer. This high level of state support ensures students are fully funded for the entirety of their studies. Kenya, meanwhile, is seeking to reduce dependence on public funding by exploring alternative financing sources such as social bonds and private investment.
Targeted support for critical skills also explains the spending gap. The Samia Scholarship provides full grants to high-performing STEM students, ensuring that the nation’s industrial and innovation priorities are addressed without saddling top talent with debt.
However, both countries face pressures as enrollment rises. In Tanzania, administrative systems are under strain from the growing volume of applicants. Verification processes are becoming increasingly challenging, and tracking beneficiaries who migrate abroad after graduation remains a persistent concern.
Kenya faces a different set of challenges. The banding system has come under scrutiny over fairness in classifying needy students, while delays in second-semester disbursements in January 2026 sparked student unrest. High graduate unemployment further complicates loan recovery, placing additional pressure on HELB and the government’s funding strategy.
Jefferson Wachira is a writer at Africa Digest News, specializing in banking and finance trends, and their impact on African economies.