THE CABLE
On June 12, 2023, while Nigerians were enmeshed in the nostalgia that Democracy Day evokes, President Bola Tinubu signed the student loan bill into law.
The legislation was sponsored by Femi Gbajabiamila, the immediate-past speaker of the house of representative.
The bill, which passed the third reading in the lower chamber on May 23, 2023, seeks to provide financial assistance to Nigerian students in tertiary institutions.
The student loan scheme as well as revamping the educational system in the nation were part of the major highlights of Tinubu’s manifesto during his presidential campaign.
The president had said teaching would be a “rewarding” career option, adding that his administration would ensure that a pilot student loan scheme is instituted for tertiary institutions.
“Institutions will charge more cost-reflective tuition fees, and with consideration for employment rates and other conditions, the loan programme will have a maximum borrowing limit and flexible repayment provisions”, he had said.
The new legislation allows Nigerian students in tertiary institutions to access interest-free loans from the Nigerian education loan fund.
TheCable highlights five major things to know about the new student loan law.
ALL STUDENTS SEEKING FEES ARE ELIGIBLE
According to the act, all students who have secured admission into any public Nigerian university, polytechnic, college of education, or any technical and vocational education and training (TVET) school can apply for the loan.
The act stipulates that the student’s income or family’s income must be less than N500,000 per annum to be qualified for the loan.
In addition, the applicant must provide at least two civil servants — of not less than level 12 years in service — as guarantors, or a lawyer with at least 10 years post-call experience; a judicial officer; or a justice of peace.
The document also said students with parents who have defaulted in respect of previous loans will not be eligible.
AN EDUCATION LOAN FUND CHARGED WITH DISBURSEMENT
The new act establishes the Nigerian Education Loan Fund. The fund will have the power to administer, supervise, coordinate, and monitor the management of student loans in the country.
The piece of legislation mandates the body to receive applications for student loans through higher institutions on behalf of the applicants and screen them.
“The fund shall be domiciled with, managed and administered by the Central Bank of Nigeria (CBN) through the money deposit banks in Nigeria for the purpose set out under section 6 of this act,” the act reads.
