Deep financial difficulties facing the country’s institutions of higher learning have sent Kenyatta university to seek a commercial loan of Sh450 million from local lenders.
In a statement indicated in tender documents, the university states that lenders have up to the second last day of February 2020 to send in their quotation to offer the loan which is repayable in a decade.
The tender notice has explained that the institution will pick on financial lender among those who will have submit their proposals by the method of selection and consistent with the regulations.
Low state funding and a decrease in the number of students joining learning institutions are major problems that have put the public universities on their knees financially.
Many public universities have in the recent past decided to scrap off some courses and even shut down some of their satellite campuses to save their financial troubles.
Kenyatta University is seeking a commercial loan barely seven months after it was on the spot when the office of the Auditor-General’s office raised queries on its financial soundness, especially after its Sh420 million Kigali building and the Sh50 million Arusha campuses were ordered closed by respective governments over quality concerns.
Edward Ouko who was then the auditor general said the university was straining financially, a crisis that drove it to rely on expensive short-term loans to cater for its operations.
Kenya’s Commission for University Education blacklisted the two campuses saying they were set up abroad contrary to the Universities Act, given that Kenyan taxpayers publicly fund the university.
It also failed to remit pension and taxes amounting to Sh1 billion, more than Sh3 million in audit fees and other statutory deductions worth more than Sh200 million.
Among its planned projects is a student hostel upgrading that is set to take place on a public-private partnership basis.
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