The Presidency has revealed the key reasons behind the amendment of the Student Loan Act, which was signed into law by President Bola Tinubu on Wednesday, April 3, 2024, saying the initial legislation would have been difficult to implement.
In a statement yesterday, Special Adviser to the President on Media and Publicity, Ajuri Ngelale explained the challenges with the previous Act and the major changes introduced by the newly enacted Student Loans (Access to Higher Education) (Repeal and Re-enactment) Act, 2024.
According to the statement, the repealed Student Loan Act, 2023, had issues related to governance and management, the purpose of the loans, eligibility criteria for applicants, the method of application, repayment provisions, and recovery of the loans.
He said the new Act addresses these shortcomings comprehensively.
According to him, one of the significant amendments is the establishment of the Nigeria Education Loan Fund (NELFUND) as a corporate body with the legal capacity to enter into contracts, including loan agreements, and initiate actions to ensure repayment by beneficiaries.
He said NELFUND is empowered to provide loans to qualified Nigerians for tuition, fees, charges, and upkeep during their studies in approved tertiary academic institutions and vocational and skills acquisition institutions in the country.
According to him, the board members of NELFUND are drawn from relevant ministries, regulatory bodies, and participating agencies, including the Federal Ministries of Finance and Education, the FIRS, NIMC, NUC, NBTE, and NCCE, as well as representatives of universities, polytechnics, colleges of education, students of tertiary institutions, and the organised private sector.
He said the governance and management structures have been separated, with a board of directors overseeing governance and a management team led by a managing director responsible for day-to-day operations.
According to him, the board comprises representatives from relevant ministries, regulatory bodies, and participating agencies, while the President appoints the board and management.
“The resource structure of NELFUND has been clearly defined, with 1 percent of all taxes, levies, and duties collected by the Federal Inland Revenue Service (FIRS) accruing to the General Reserve Fund.
“This fund will be used to pay loans to qualified applicants and cover operational expenses.
“Significantly, the eligibility criteria have been revised, removing the family income threshold and guarantor requirement. Students can now apply for loans and accept responsibility for repayment, subject to application and identity verification guidelines provided by NELFUND.
“Additionally, a student’s application can no longer be disqualified based on their parent’s loan history,” he explained.
