You are welcome to another very informative post on your favorite website, www.suresuccess.ng. This post is about the new Student loan bill in Nigeria. So I’m going to give you salient information about the President Tinubu Student Loan Bill Nigeria. You will learn what it entails and the conditions for eligibility for students who wish to access the loan. I will also show you how to apply for the Tinubu student loan.
Table of Contents
Meaning of Student Loan
A student loan is a formal agreement on the basis of which a student at a university borrows money from a bank to foot their education bills and then pays the money back after they finish studying and start working. However, there must be some mechanisms in place to verify the claims of applicants for student loan with respect to their studentship. The school in which the student is an undergraduate or post graduate must be accredited or recognized by relevant government regulatory agencies.
Student Loan Bill in Nigeria
The student loan bill is a bill that now makes it possible for Nigerian students to access interest-free loans to pay for their education. The bill was introduced by Mr. Femi Gbajabiamila, the outgoing speaker of the House of Representatives and was signed into law by President Bola Tinubu on Monday, June 12, 2023.
The title of the bill reads:
“An Act to Provide Easy Access to Higher Education For Nigerians Through Interest-Free Loans From Nigeria Education Bank Established in this Act with a View To Provide Education for All Nigerians and for Related Matters.”
This new law would have several implications and impacts on the nation’s education sector.
For example, a robust education bank would be created in Nigeria. This would grant federal tertiary institutions the freedom to enact tuition fees.
Rapid increment in school fees is already the reality in many tertiary institutions across the country. Actually, there are Nigerian institutions that have increased their tuition fees by more than 200% in the past three years.
Hence, the urgent need to create the education bank that would help to bridge the financial gap in academic institutions.
Is There Really a Need for Government Loan for Students in Nigeria?
Yes, there is a very urgent need for students loan in Nigeria.
Over the years, regardless of the regime or administration, Nigeria’s budget for Education has been grossly below the UNESCO standard which is 15 percent of total budget. Nigeria’s budget for the education sector keeps dancing around 5 percent of the total budget year in year out.
This is why the education sector in the country is in shambles barely having the infrastructures and personnel obtainable in other climes. Of course, this is in addition to the large number of people willing to further their education but are unable to do so because they do not have the wherewithal.
The aim of the student loan scheme is to expand access to education to all Nigerians regardless of their backgrounds. At the same time, this will give institutions the freedom to charge higher tuition fees.
Once the education bank is in place, Nigerians willing to attain higher education qualifications can afford the school fees.
What Does the Tinubu Student Loan Bill Entail in a Nutshell?
The act will enable poor Nigerian students to have access to federal government loans to pay for their education.
The following gives an overview of the features and implications of the Nigeria Students Loan Act:
- The government shall establish a Nigerian Education Bank to provide loans for Nigerians for educational purposes only.
- There shall be a screening mechanism to ensure that the loan is accessible only to indigent students studying within Nigeria.
- Students in private tertiary institutions shall not be given consideration. In other words, those eligible are only the poor students in government universities, polytechnics and colleges of education.
- The student loans shall be interest-free. This means that the beneficiaries will only pay back the total amount they collect.
- The loan shall be solely for payment of tuition fees and must not put to any other use.
- All Nigerian students will have equal rights to access the loan without any form of discrimination arising from gender, religion, tribe, position or disability.
Eligibility Requirements for Accessing Student Loan in Nigeria
For Nigerian students seeking to know how to get student loan in Nigeria, it is important that you first get an insight into the requirements for application.
So in this section, you will find the requirements you must meet before you can apply for student loan in Nigeria.
The following are the requirements…
1. Applicant must be a current student in a public university, polytechnic, college of education, or TVET program in Nigeria.
2. The income of the applicant or the family must be less than N500,000 annually.
3. The applicant must provide a minimum of two guarantors. These guarantors must be civil employees with at least 12 years of service at level 12; lawyers with at least 10 years of post-call experience; judicial officers, or justices of the peace.
4. Students with past records of felony, exam fraud or drug use would not be taken into consideration. The same also applies to students who have defaulted on prior loans.
5. The students parents would also come under scrutiny and those who are found to have defaulted on prior loans will not be taken into consideration.
How to Apply for Student Loan in Nigeria
- The first step to apply for student loan in Nigeria is to meet the requirements. Meeting the requirements will qualify the student to apply for the loan.
- Following the fulfillment of the requirements, the students are to apply for the loans through the student affairs office of their institution.
- The applicant must attach the following to their application:
- photocopy of the student’s admission letter,
- a full list of all qualified applicants from the institution,
- a cover letter signed by the vice chancellor, rector, or other appropriate institution head and the student affairs.
- two passport photographs from each guarantor. Information on the guarantors’ employment and proof of employment with name of organization.
- The Student Affairs Office will submit the application to the Chairman of the Education Bank.
According to the act, this entire process would be simple, seamless and fast. The Committee would communicate the applicant’s application status within 14 days of receiving the application.
More so, the committee will complete the processing of application and disbursement within 30 days of receiving application.
Repayment of the President Tinubu Student Loan in Nigeria
This section is very important and Nigerian students need to read it very carefully. Yes, the President Tinubu Student Loan Bill Nigeria is new and almost every student would like to get it.
But students need to understand that what we are talking about here is students LOAN and not grant. In simplest terms, loan implies that there would be repayment later.
So you have to etch this at the back of your mind and realize that defaulting would have grave consequences.
How to Repay Student Loan in Nigeria
Beneficiaries of the loan have until two years after completion of their NYSC to start repayment. Once the time comes, 10% of the beneficiary’s salary will be directly withheld from his or her paycheck as repayment by the employer. The employer will credit the amount to the loan scheme.
If the beneficiary happens to change their job, they are to notify the loan board within 30 days of resuming employment with the new employer. They must also provide details of the new job.
In a case where the beneficiary is self-employed, he must deposit 10% of his monthly gross income into the student loan account that the bank will provide.
A self-employed person must provide the Commission with all relevant information about their business. This must include: the name of the business, address and location, registration documents, name of bankers, names of partners, names of directors, and shareholders. And the person must do this within 60 days of assuming that status.
So like we noted earlier, beneficiaries of the student loan MUST repay. Those who default or those found to be aiding the default of repayment are guilty of an offence. If convicted, they shall be liable to imprisonment for two years or a fine of N500,000 or both.
We must commend the proposer of this bill for including loan repayment terms and penalties. Otherwise, there wouldn’t be timely and responsible repayment. And if that becomes the case, the loan scheme will no longer be sustainable as their would not be funds for future students.
So here’s where we end this very informative article about the new students loan bill. We trust that it is helpful.
Let’s keep our fingers crossed with hope that those at the helm of affairs will implement this student loan act effectively. If they do, tertiary education would become accessible to everyday Nigerians.
Remember that you can use the comments section to ask questions in case there’s something you don’t understand about the new loan scheme. Or just share your thoughts with us.
See you on the next article.
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