1. Revolutionary Funding Mechanism: Federal Inland Revenue Service to Allocate 1% of Revenue to Student Loan Scheme.
2. Accessibility Overhaul: Parental Debt History No Longer a Barrier for Student Loan Applicants.
3. Income Threshold Abolished: Eligibility Expanded, Allowing More Nigerian Students to Access Loans.
4. Flexible Repayment Terms: Loan Repayment Deferred Until Employment, Forgiveness in Case of Death.
5. Strict Penalties for Deception: False Declaration Incurs Three-Year Jail Term.
6. Institutional Innovation: Establishment of Nigeria Education Loan Fund (NELFUND) to Oversee Loan Disbursement and Management.
In a significant stride towards bolstering educational accessibility and empowering Nigerian youth, the Federal Government has enacted a comprehensive overhaul of the student loan system with the introduction of the new Student Loan Bill.
One of the most groundbreaking features of the bill is the establishment of a sustainable funding mechanism, whereby 1% of all collectable revenue by the Federal Inland Revenue Service (FIRS) will be earmarked to fuel the student loan scheme, ensuring a steady stream of resources to support higher education aspirations.
Furthermore, the bill addresses longstanding barriers to accessing student loans. Gone are the days when a parent’s debt history could disqualify a student applicant. The removal of hurdles such as the guarantor requirement paves the way for easier access to loans, subject to streamlined application and identity verification procedures.
Crucially, the bill abolishes the family income threshold condition, opening doors for a wider pool of Nigerian students to apply for loans and take responsibility for repayment according to the Fund’s guidelines, thus democratizing access to higher education.
In a bid to promote fair and flexible loan repayment terms, the bill stipulates that beneficiaries will commence repayment only upon gaining employment, with forgiveness provisions in case of unfortunate events such as death or circumstances beyond the beneficiary’s control.
“According to the bill, the Fund shall not initiate loan recovery efforts until two years after the completion of the National Youth Service Corps (NYSC) programme.
A beneficiary may request an extension of enforcement action by the Fund by providing an affidavit indicating that he is not employed in any capacity and is not receiving any income.
It makes provision for loan forgiveness in the event of death or acts of God causing inability to repay.”
However, the bill also carries a stern warning for those tempted to deceive the system, imposing a three-year jail term for providing false statements to the Fund under the loan repayment section, underscoring the government’s commitment to transparency and accountability.
Institutionally, the establishment of the Nigeria Education Loan Fund (NELFUND) as a body corporate represents a landmark initiative to streamline loan disbursement and management, with provisions ensuring national equity in loan distribution.
“The Bill Seeks to Establish the Nigerian Education Loan Fund as a Body Corporate to Receive, Manage and Invest Funds to Provide Loans to Nigerians for Higher Education, Vocational Training and Skills Acquisition and for Related Matters.
– Establishment of the Nigeria Education Loan Fund (NELFUND) as a body corporate that can sue and be sued in its name and has the power to acquire, hold, and dispose of movable and immovable property for the purpose of its functions.
– The Bill establishes a justice and fairness provision mandating the Board to ensure a minimum national spread of loans approved and disbursed in each financial year.
NELFUND can legally enter contracts, including loan agreements and may also initiate action to ensure repayment by beneficiaries.
– It also empowers the Fund to provide loans to qualified Nigerians for tuition, fees, charges, and upkeep during their studies in approved tertiary education institutions and vocational and skills acquisition institutions in Nigeria.”
With these sweeping reforms, Nigeria is poised to usher in a new era of educational empowerment, where access to higher education is no longer a privilege but a fundamental right, propelling the nation towards a brighter, more prosperous future.
Credit: Journalist KC/X
