New University Funding Model: How Bands Ensure Fairness in Cash Allocation

The government in May 2023 announced the introduction of the Variable Scholarships and Loans Funding (VSLF), dubbed the New Funding Model (NFM), designed to align funding more accurately with the needs of individual students rather than institutions.

The model differs from the old model – Differentiated Unit Cost (DUC) – under which students received equal capitation from the government.

In the New Funding Model, instead of a uniform grant, funding is based on the Means Testing Instrument (MTI) to determine the level of need for government scholarships and loans. The MTI system has grouped students in five bands, according to their needs.

The cost-sharing model has been revised, and the funding ratios from the government, households, and other sources have been adjusted.

Band One entails students who are extremely needy and vulnerable. This group gets scholarships at 70% and loans at 25% while the household will contribute only 5% of the fees. The student gets upkeep support of Ksh60,000.

Band Two is for low-income families who require substantial aid and will get a 60% scholarship, and 30% in loans while they will have to pay 10% of the fees, with the student getting Ksh55,000 in upkeep.

Band Three are students from families that have modest incomes. They get 50% in scholarships, 30% in loans, and Ksh50,000 as upkeep. Their families will pay 10% of the fees.

Bands Four and Five, considered middle and high-income earners, will pay the most of the tuition fees per household at 40% while the students will get 30% as loans and between Ksh40,000 and Ksh45,000 as student upkeep.

THE BANDS IN SUMMARY 

Band 1: For families with a monthly income up to Ksh5,995

Band 2: For families with a monthly income up to Ksh23,670

Band 3: For families with a monthly income up to Ksh70,000

Band 4: For families with a monthly income up to Ksh120,000

Band 5: For families with a monthly income above Ksh120,000

The funding criteria are now based on the actual cost of university programs, which varies from institution to institution. “Universities will benefit from diversified funding streams, including student financing, research grants, capital infrastructure grants, and consultancy services,” the government says.

The key government players in the model include the Higher Educátion Loans Board (HELB), the Universities Fund (UF), the Kenya Universities and Colleges Placement Service (KUCCPS) and the State Department for TVET and Higher Learning Institutions.

Requirements for Undergraduate & TVET Applications 

1. Applicant’s valid email address and a valid telephone number;
2. Applicant’s KCPE and KCSE index numbers and year of examination;
3. Applicant’s Passport size photo (in jpeg/jpg/png);
4. Applicant’s copy of the National ID/Maisha Card (both sides in PDF);
5. Applicant’s valid bank details or valid MPESA number (registered under the applicant’s name and ID number);
6. Parents’ National ID and registered telephone number;
7. Copy of Parent’s déath certificate if deceased (in PDF);
8. Applicant’s birth certificate in PDF (if applying as a minor);
9. Two guarantors’ ID numbers and registered telephone numbers (Can be parents); and
10. Copy of the sponsorship letter (in PDF) if sponsored in Secondary school.