Student Loan:Matters Arising

ON April 4, 2024, President Bola Ahmed Tinubu assented the Student Loans (Access to Higher Education) Act (Repeal and Re-Enacted) Bill 2024, aiming to provide Nigerian youths with interest-free loans for educational pursuits. The amendment of the initial Student Loan 2023 bill, signed into law by Tinubu on June 13, 2023, was prompted by various challenges encountered in its implementation. The amended Act establishes the Nigerian Education Loan Fund (NELFUND) as a body corporate with the power to provide loans for tuition, fees, and upkeep during studies at approved tertiary education and vocational institutions in Nigeria. Unlike the previous law, the administration of the Fund is now centralized under NELFUND of which President Tinubu has appointed a management, eliminating the Special Committee structure.

KEY amendments include the removal of income eligibility criteria, guarantor requirements, and the disqualification of applicants based on their parents’ loan history. Additionally, the Act expands loan purposes to cover not only tuition but also other institutional fees and maintenance allowances for students. It introduces leniency in loan recovery, delaying repayment until two years after the completion of the National Youth Service programme and providing avenues for extension due to unemployment.

UNLIKE the previous Act’s punitive approach, the new legislation criminalizes only false statements to the Fund and allows for loan forgiveness in cases of death or extreme circumstances. This shift aligns with the intention to foster inclusion, equality, and flexibility in education.

ACCORDING to educationists who support the initiative, such as the former Vice-Chancellor of Adekunle Ajasin Akungba University, Ondo State, Prof Femi Mimiko, it will enhance the struggling universities if the intention of the Act is properly delivered. Mimiko added that the compelling implication of the scheme was that it would now make it permissible for all tertiary educational institutions in the country to charge for tuition, adding that the lack of tuition fees in the institutions was the very recipe for institutional decay, which had been the lot of higher educational institutions these past decades. Other benefits of the Student Loans identified are fostering inclusion and equality in education, providing flexible payment methods for youths, and provision of an education bank in Nigeria.

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WHILE  it is cheering to see the amended Student Loan Bill signed into law, concerns persist regarding the initiative’s implementation and its impact on the Nigerian educational system. First, the date of take-off of the loans has not been announced. Recall that the 2023 Act was scheduled to take off in September 2023, but it didn’t. It was later announced to take off in January 2024 but was also postponed to March 14 before it was later postponed indefinitely, before its amendment into the 2024 Act. This raises concerns about effective execution.

ALSO, there are fears that the loans may exacerbate the cost of education, leading to lifelong indebtedness for beneficiaries. Recent fee hikes by several universities heighten worries about potential exploitation and oppression, prompting calls for fee stability from student bodies like National Association of Nigerian Students (NANS). The Federal University of Technology, Akure, University of Jos, Plateau State University, University of Uyo, and Bayero University, Kano are examples of universities that exacerbated the current economic hardship students and parents face by increasing their fees. It will be in order if the plea of the NANS that no university should increase fees in the next ten years is granted.

THE Academic Staff Union of Universities and other stakeholders advocate for comprehensive reforms and increased funding of tertiary institutions by government. This will foster quality education and national development. Moreover, alternative solutions, such as government scholarships and grants, are proposed to alleviate financial burdens on students without the obligation of repayment. These mechanisms streamline assistance delivery, empower students economically, and foster societal contributions through entrepreneurship and innovation. Accessing scholarships and grants is devoid of bureaucratic complexity as the funds go directly to the beneficiaries. In addition, beneficiaries are debt-free and are more likely to contribute to economic development through entrepreneurship, innovation, and timely investments in their communities.

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WHILE the Student Loans (Access to Higher Education) Act represents a step towards educational accessibility, its successful implementation hinges on prompt take-off and proper management. Sustainable reforms, inclusive policies, and diversified financial support mechanisms are essential to realizing the transformative potential of education in Nigeria.

Student Loan:Matters Arising

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Student Loan:Matters Arising

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