Regina Otokpa 
Background
Education is an important instrument that aids the developmental progress of any country. It is an important foundation that helps in developing humans by improving their knowledge, skills and personal qualities that prepares them for life.
It also enhances young people’s capacity to participate in the global economy, acquire civic skills and establish social cohesion among communities. Sadly, for many, a seamless access to this all important asset, is fraught with some challenges such as poverty, inequality, and access.
Over the years, some students in tertiary institutions have been forced to drop out of school due to inability to fund their tuition fees. Some others desirous of acquiring tertiary education grow cold feet when they calculate the financial implications of embarking on and completing the journey, given the sad reality of not having anyone to fund their education.
But some young Nigerians have been fortunate; they benefit from one form of full or partial scholarships of some sorts. With the current economic situation, spiraling inflation, especially that of food, which has seen the tripling prices of goods and services, including tuition fees and sundry charges that undergraduates have to pay each semester, access and completion of tertiary education, seems to be at a crossroads due to the enormous challenge of affordability.
Zero interest student’s loan
To change this ugly narrative, the Federal Government signed the Student Loan Act 2024, as part of its initiative to assist students struggling with payment of fees in public tertiary institutions, and made to pay later.
Launched on May 24, 2024, this government-backed initiative driven by the Nigerian Education Loan Fund (NELFUND) established by an Act of the National Assembly; will among others provide affordable and accessible education financing to students from low-income backgrounds, by offering interest-free loans, with flexible repayment terms to students studying in universities, polytechnics, colleges of education and technical colleges.
President Bola Tinubu had proposed N50bn for the take-off of the students’ loan scheme in the 2024 budget, which he presented to the National Assembly in November 2023.
According to him, once the path to take students out of poverty has been cleared, the future of Nigerian children would be brighter. “The only thing that can fight poverty is education. Today, I signed the Bill for the Student Loan Scheme.
Imagine the children of the poor; what about people going through the mud, fishing in the ponds? How do you tell their children that their future will be brighter?
It is only through education that we can fight poverty. A promising future awaits our children,” Tinubu said. Initially scheduled to take effect in September 2023, the scheme was, however, delayed to enable the Fund expand its mandate to cover interest-free loans to Nigerian students interested in skill-development programmes.
The President maintained there was need for the scheme to accommodate those who may not want to pursue a university education. He added that skill acquisition was as essential as obtaining undergraduate and graduate academic qualifications.
Funding
Many have expressed concerns over the funding and sustainability of the student loan programme, given its financial implication but the Chairman, House of Representatives’ Committee on Student Loans, Gboyega Isiaka, allayed the fears when he revealed that the funds would be drawn from one per cent of all revenues accruing to the Federation Account.
It was for this reason the initial Student Loan Act was repealed to remove all encumbrances that could prevent Nigerian students from accessing the loan.
He further gave assurances, saying; “The patriotism and determination to ensure sustainable success led the Executive, and particularly Mr. President, to present these far-reaching amendments, which have now become law.
“The amendments have addressed many shortcomings in the 2023 law, particularly regarding funding. We now have a well-defined corporate entity called the Nigerian Education Trust Fund, creating a strong and sustainable institution comparable to those found elsewhere in the world.”
Students delighted
When news of the loan scheme first broke, many Nigerians greeted it with excitement, however, it began to fade when the Bill suffered some setbacks before its final assent into law by President Tinubu.
Patiently, the wait was finally over when the loan portal officially was officially launched to allow students access to apply. Abdullahi Adamu, a student of Bayero University Kano (BUK), noted that the loan was a God sent to many students who are finding it difficult to pay the exorbitant fees being charged by management of tertiary institutions in Nigeria.
“The loan is God sent. It will help us to start and finish school, without thinking too much. My father has 26 children; next year we can be more than this number. Once he manages to train you through primary school, he will hands-off.
Our mothers are the ones trying to train the boys to at least secondary school. “My own mother has nine children, because we are only three boys, it is easier for her to struggle to train us to university level.
This loan will be a big relief. She is really trying for us through her biasness. Thank God my father opened businesses for his wives and thank God my family knows the value of education, maybe we will be on the street begging to survive.”
Bidemi Odion, a Law student at the Benue State University (BSU), noted that beyond meeting the financial needs of most students, the loan will solve a lot of mental, and psychological issues, and allow for maximum concentration on studies.
According to him, ‘‘the thought of where or how your next fees for the semester will come about, how you will survive the semester, with the many other financial demands, can be frustrating, and will derail one’s mental state of mind.
“Once I know my school fees is sorted out, it will be easier for me to settle down and concentrate on my studies, better comprehend what I am being taught, get value for my time and monies being spent on books, and some other underlining charges and payments as well as my upkeep in school.
It’s a big plus to the government.’’ Audrey and Adriel Akinyemi, both students of University of Abuja, view the loan scheme as a good move in the right direction.
According to the twins, the worst thing that can ever happen to a student is dropping out of school because of funds. A pathetic story by a young lady who gave her name simply as Patience, is proof that the loan will be of immense help to thousands of young Nigerian undergraduates, who are suffering in silent and burdened by lack of finance to fund their education.
“I come from a family of eight. My father went bankrupt while I was in secondary school and later abandoned us. How I completed and sat for WAEC is a story for another day.
I got admitted into BSU twice and dropped out due to funds. I worked and saved some funds again and gained admission into Kwara State University but again, I couldn’t scale through.
“Because I was determined to get a higher education, I saved up once again and went to Usman Dan Fodiyo University in Sokoto and today, I am a proud Biologist though still struggling with unemployment.
‘‘Imagine the time wasted as a result of not having enough money to see myself through school. I am 100 per cent in support of the loan.’’
Processes
Ever since its launch, the official website and X account of NELFUND have been attracting thousands of hits and visitors every day, as students and other concerned Nigerians try to apply, or get more information on the loan scheme.
The student loan scheme is designed to pay for the financial obligations of successful applicants studying in public tertiary institutions within 30 days of approval as applied for each academic session.
NELFUND’s target is to benefit the 1.2 million students in federal institutions in the first phase of the scheme, as well as benefit students in state owned institutions before the fourth quarter of the year, barring any unforeseen circumstances.
Contrary to the belief of many, accessing the student loan is not as easy, as the loans is not disbursed through the loan apps after few punches but rather the student loan has a strict process that qualifies an applicant to be eligible.
Managing Director/Chief Executive Officer of the Fund, Akintunde Sawyerr, who gave insight on the eligibility of applicants, including direct entry students, said applicants must provide specific details. Some of these include:
JAMB number, name of institution of study, admission number, Date of birth, National Identity Number (NIN), and Bank Verification Number (BVN). Other requirements are upload of scanned admission letters for new students, and student identification cards.
However, only students whose data has been uploaded to the NELFUND website would be able to apply for the loan. Most importantly, applicants’ JAMB Number, BVN and NIN must correspondent in order to access the loan.
Giving more clarity, Sawyerr noted that to avoid situations where the loan could be misused, the loan covering 100 per cent cost of institutional charges, no matter the amount charged by the institution, will be remitted directly to the applicants’ institutions while the stipends for student’s upkeep will be paid to the applicant on a monthly instalment basis.
Even though the amount charged per institution for same course differs, the Fund is empowered to pay each respective of the amount specified, to each institution.
Name, shame institutions
Despite the juicy offer from government, it is sad to note that many students are still unable to take a shot at applying for the loan due to failure of their institutions to comply with the directive of uploading the data of their students to NELFUND’s Student Verification System (SVS).
This development is the main reason why students in state-owned institutions have not been able to apply for the funds alongside their counterparts in the federal institutions.
One would have expected the names of defaulting institutions to have been published to propel prompt action but Sawyerr has vehemently refused to name and shame institutions yet to do so, as he believes they could be experiencing one little challenge or the other which might just have been addressed while calling them out.
The management of the fund vowed to publish names of both federal and state institutions who have succeeded in uploading the data of their students to its SVS by last month.
Even though the Fund had said the scheduled move was to ensure transparency, encourage due access and participation in the scheme, however, the early announcement many believe, is to give defaulting institutions a head start to quickly upload the data to avoid embarrassment.
To resolve this problem, NELFUND had earlier advised students experiencing such difficulties to approach the ICT departments of their schools to upload their records to the Students Verification System (SVS).
Why an applicant may be denied
Accessing the student loan is an opportunity many families do not want to miss. However, what they have failed to realise is the fact that not every student in a public tertiary institution whose name has been upload on the SVS, may automatically get the loan at first trial.
While strict adherence to laid down processes remains key, other critical information that may affect the loan approval include; default in payment of any previous loan granted by any license financial institution; if found guilty of submitting fake/fraudulent documents; history of examination malpractices by any school authority; conviction of fraud and forgery; drug offences; cultism; felony; or any offences involving dishonesty.
But all hope is not lost for affected students as the Fund has disclosed that an applicant denied application can raise a complaint from the portal or send an email to NELFUND for an appeal.
It is equally important to note that the email addresses, admission details with JAMB, BVN, NIN, matriculation and admission numbers, full names and dates of birth of the applicant must be correct and correspond to be eligible to apply for the loan.
Status
Five days after the official launch of the loan site, over nine million and half hits were recorded, over 60,000 applications from students in federal government institutions were received while 30,000 of these number of applications were free of errors and successfully processed for possible disbursement.
On the average, 1,500 applications are received on a daily basis. Sawyerr noted, “We have had an overwhelming response to the student loan portal. Since the launch of our student loan application portal last Friday for students in federal institutions of higher learning, we have witnessed an extraordinary surge in applications with over 60,000 applications since the launch of the portal.
‘‘This for us has been an overwhelming response and it serves as a testament to the critical need for financial assistance amongst our student population. We remain committed to addressing this urgent demand.”
About a month after the portal began accepting loan applications from students in federal institutions, no fewer than 70,000 students in federal tertiary institutions have made the first batch of students to have their tuition fees paid to their respective institutions of learning.
Also, the loan application of 50, 000 students were at the time undergoing evaluation for possible approval within 30 days for onward payment.
Credible intelligence who preferred not to be mentioned on print equally confirmed that the sum of N35 billion was approved for payment across 124 federal tertiary institutions.
“The N35bn cuts across all the 124 federal institutions that we have rolled out so far. But we are still getting applications from students from federal institutions before we roll out the
state institutions.’’
Extending loan scheme to skill acquisition
Sawyerr recently disclosed that the Fund in a bid to go beyond financial assistance to students, would in the next six months, launch its skills acquisition programme.
This is because it recognises the profound importance of equipping all Nigerian youths with practical market relevant skills. “Six months from today, we will launch a comprehensive skilled skill acquisition programme providing training in various vocational and technical fields.
This programme is designed to prepare students to meet the demands of the modern job market, fostering entrepreneurship and innovation amongst our young people,’’ Sawyerr said.
Criticisms
Contrary to the expectations of students and parents, NELFUND kick started the application process for the loan with federal institutions only. Several criticisms trailed the decision making the Fund to announce June 24, a day students in state-owned tertiary institutions, would join the scheme.
However, this was never the case, as the date has been further extended by 14 days. Management of the Fund had cited poor compliance on upload of students’ data into its SVS by state institutions.
Unhappy with the development, many students and parents have continued to fault the federal government’s hasty decision to float a system that is promoting inequality, the same challenge it claimed it was coming on board to address.
According to a lecturer at Keffi State University, who preferred to remain anonymous, the loan will be more beneficial to students in state-owned universities, given the huge difference in tuition fees.
“I’m not a pessimist but I fear this whole loan thing might develop issues in the future being that they seem to be having a rocky start. One would have expected them to be ready and capture everyone on board,’’ he queried.
Adding; ‘‘Why the decision to start with federal institutions first, before incorporating state owned institutions?
Well, I just pray they know what they are doing. Sorry to say, but I don’t have faith in this, parents better not put the whole of their minds to it, it’s a friendly advice from another parent.”
Akowe Jude, whose children are schooling in Kogi State University, noted that rather than begin the scheme with federal institutions, the state owned institutions should have been the first to benefit from the scheme since it couldn’t accommodate all the institutions at the same time.
He said, ‘‘it is surprising to see government starting the loan scheme, which it said will address issues of poverty and unequal access to education, with students studying in federal institutions, which are already cheaper if you look at the real sense of it.
‘‘State institutions are very expensive, their students should have been considered first since the programme was programmed to run in phases. “My advice to government is next time they shouldn’t be in a haste to launch this kind or programme.
Carry out adequate planning, employ capable hands and roll out at once. The student loan shouldn’t be subjected to phases as if you are running a pilot programme in some states for experiment.”
Anita Omudu, who expressed reservations with the loan programme, said; ‘‘already, the agency is failing to meet targets. Rather than tell Nigerians the truth, it is blaming state institutions for failing to upload their student data but the case was different for the federal institutions.
The very moment they announced it was federal states will come up later, I knew the programme may just be bound for doom even before it started.”
Capacity
However, management of NELFUND has continued to reassure Nigerians of its capacity and ability to capture all Nigerian students. While noting state institutions are unequivocally by law included in the student loan programme.
NELFUND further explained that the programme is designed to roll out in phases in order to ensure effective and efficient management of the process.
According to it; “The first phase for a start will focus on students attending federal institutions. The second phase which will be launched shortly after the initial rollout, will extend the programme to students at state institutions.
“NELFUND is fully committed to providing financial support to all eligible students, regardless of whether they attend federal or state tertiary institutions.
The mission of President Bola Ahmed Tinubu’s Renewed Hope Agenda is to ensure that all desirous students have access to the financial resources necessary to pursue their educational goals and aspirations.’’
Repayment
Many Nigerians have a mindset that it’s easy to evade repayment of loans administered by government due to the unsustainability of programmes by new government.
However, NELFUND has insisted that every money disbursed will be repaid by beneficiaries two years after completion of their NYSC programme in a flexible manner.
Ten per cent will be deducted from salaries of beneficiaries from source every month until the loan is cleared while those who are self-employed are required to remit 10% of their monthly profits until the loan is cleared off.
Also, those relocating out of the country must enter into a signed agreement with NELFUND on repayment modalities and beneficiaries yet to get a job of any sort two years postNYSC are expected to notify the Fund by sworn court affidavit every three (three) months.
However, beneficiaries can repay beyond the statutory 10% monthly repayment by their employers or personally if self-employed while those with money to pay before they get a job are also free to do that.
In respect of the repayment structure, Chairman House of Representatives’ Committee on Student Loans, Gboyega Isiaka, had explained that provisions in the law mandates employers to verify an individual’s education loan status before employment, adding that non-compliance would result in penalties, including fines, imprisonment, or both.
Although the federal government has insisted that the loan is interest-free and with flexible repayment arrangements, some parents and students are, however, skeptical of engaging the structure to avoid “regrets” in the nearest future, despite the economic and social benefits of the scheme.
While some are confident it was a way forward for the education sector given the harsh economy and inability of many secondary school leavers to further their education, majority have raised concerns over the country’s poor loan recovery system, lack of citizen’s data, poor banking system and ability to sustain the programme.
A Development Communication Specialist, Dr. Geoffrey Njoku, is confident that the loan will benefit students, as he noted; “I think they will benefit differently.
First and foremost, the students will or their parents will, because.it will reduce the burden of funding or paying of school fees; if my child gets a loan that means I don’t need to go out hustling and scrambling to look for school fees for him, so it benefits me.
“It also benefits my child because his school fees will not be a burden on me, it will not be a problem because sometimes, students will have to go to school the school is harassing them to bring their school fees while the parents are hustling to find the money.
“The child has been harassed by the school authorities to pay his/her school fees. The benefits to both parents and the students also benefit the school because now the school can plan.
“They know that X amount of money will come in and for planning purposes, they can plan forward on what they would like to use the money for otherwise it would have been something like I have 1, 000 students and they get only 500 that would pay their school fees.’’
To Be Continued.
