The Managing Director of the Nigerian Education Loan Fund (NELFUND), Akintunde Sawyerr, stated that they anticipate attracting between 250,000 to 300,000 applicants for the student loan scheme this year from the academic sector.
Sawyerr made this remark in a statement during an interview with Channels TV’s Newsnight on Monday in Abuja.
The director mentioned that the number of applicants from the non-academic sector might be significantly lower since that part of the scheme is just commencing.
However, Sawyerr assured that NELFUND has a sufficient budget to cover all students in tertiary institutions across Nigeria, which currently totals about 2 million students.
He said the loan is open for not only those coming into the system but also students who are already in various public institutions in the country.
“Currently today in tertiary institutions across the board including the private sector, there are about 2 million people. This loan is open to those who are already in the institutions. This is not about those coming in only. This is about if you apply for a loan today, for the next session, you will get it.
“Arguably, we can give everybody a loan. The funds are available to make for us to cover those sorts of numbers over time.
“This year we expect to have 250 to 300,000 applicants from the academic side. We are going to have less than that for the vocational side because we are just kicking that process of,” Sawyer said.
On loan recovery
Speaking on the issue of loan recovery, the director of NELFUND said the loan is expected to be deducted directly from the sources of earnings of applicants once they start working.
He said the scheme is also insured to help cover certain risks and exposures that may affect the initiative during the process.
Meanwhile, Sawyer added that the revised Student Loan Act provides loan forgiveness in certain situations, particularly when the borrower unfortunately dies and is unable to pay back the loan granted to him.
“Because of the potential risk of loss of funds. As you can imagine, if you deploy funds to anything, you can lose that investment. These loans will be insured.
“I should point out that the law makes provisions for forgiveness of debt if the applicant dies. Insurance will take care of some of the risks and exposure.
“It’s worth pointing out that in terms of the loan recovery itself, it will be directed deductions from source when people are earning,” Sawyerr added.
What you should know
The revised Student Loan Act 2024 aims to eliminate financial barriers and make education accessible to all Nigerian students, regardless of their economic background.
NELFUND’s primary funding sources include a percentage of taxes, levies, and duties collected by the Federal Inland Revenue Service (FIRS), Nigerian Immigration Service, and Nigerian Customs Service, amounting to 1% of their total revenues.
Additionally, the fund will receive contributions from government profits generated through natural resource exploitation, education bonds, endowment fund schemes, and donations from individuals and organizations.
The loans cover tuition, fees, and maintenance costs, with repayment starting two years after the beneficiary completes the NYSC program.