The Students Loan Bill, which President Bola Ahmed Tinubu signed into law on June 12, 2023, enables interest-free loans for Nigerian students, particularly those from impoverished families. The intention is that higher education in universities, polytechnics, and schools of education will not be hampered by financial restraints.
A number of partners, including the Central Bank of Nigeria and commercial banks, will manage and oversee the administration of the Nigerian Education Loan Fund, which was established by legislation.
According to reports, it has systems in place to keep an eye on student progress in the classroom, guarantee loan payments are made on time, and stop fraud.
The initiative’s funding comes from a variety of sources, including donations, education bonds, a portion of government taxes, levies, and tariffs, and income from the exploitation of natural resources.
By easing financial restrictions, the student loan bill seeks to increase the rate of higher education in Nigeria. As a result of the law, students may now apply for this loan and utilize the money to pay for their higher education.
The law established the Nigerian Education Loan Fund, which would administer and distribute the monies to eligible students. Below is further information on this.
Admission to a federal or state university, polytechnic, college of education, or vocational institution is required.
Your or your family’s annual income must be less than 500,000 ($1,000) or 42,000 ($88) per month.
You must supply two guarantors who are either:
A civil servant with at least a level 12 qualification. Because bachelor’s degree holders often begin Nigerian civil service in Grade 8 or 9, the guarantor would be in a mid-level post.
A lawyer with, at least, 10 years of post-call experience Judicial officer Justice of peace.
You could be denied a student loan if you:
You or your parents have previously defaulted on a loan.
You were found to have committed examination malpractice.
You’ve been convicted of a felony or a fraud-related offense.
You were convicted of drug offenses.
How will the Loan be paid back?
Repayment on student loans in Nigeria will begin two years after the National Youth Service Corp (NYSC) program is finished.
10% of your pay will be withheld by your employer at source and sent to the Student Loan Fund. You must notify your employer of a job change within 30 days of starting the new position.
If you work for yourself, you must contribute 10% of your monthly gross earnings to the fund. The loan committee will receive all pertinent business-related documentation within 60 days.