Kenyan Private Schools Borrowed $128.8 Million to Survive COVID-19

Information obtained from the Kenya Private Schools Association (KPSA) has shown that between April and December 2020, 331 private schools in the East African country borrowed as much as $128.8 million ( Sh14 billion) from commercial sources.

Business Elites Africa gathered that the schools, which collectively have a student population of about 65, 600 and some 1, 200 teaching and non-teaching staff, borrowed the money in order to survive the economic hardship posed by the COVID-19 pandemic.

The pandemic disrupted every aspect of the Kenyan economy, especially the education sector because many schools were forced to shut down. Following this development, the Kenyan Government had promised to a $64.4 million (Sh7 billion) palliative to the schools. Unfortunately, the promise never materialised, thereby forcing the schools to resort to borrowing $128.8 million from banks.

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But then again, the loans are not even sufficient for the private schools because most banks were sceptical about lending to them. The schools were also given stringent conditions. Commenting on the development, the Chief Executive Officer of KPSA, Peter Ndoro, said:

“Private schools have had to borrow over Sh14 billion from commercial sources during this covid-19 period from May to December 3. Even whatever they are giving us is not sufficient because they (banks) are not too sure whether our business will rebound and get back to normal,” said Mr Ndoro in an interview.”

Note that many of these private schools continued to pay their rents even while they were under lockdown. This was to enable them retain these spaces ahead of when they would be returning to classes. A lot of of the schools were also paying their staff even during the lockdown.