President Bola Tinubu of Nigeria has recently enacted the Students Loan Bill, signifying a significant stride towards improving access to higher education in the country. This momentous development paves the way for a transformative era in educational funding.





Clear and Streamlined Application Process: Facilitating Affordable Education

The Students Loan Bill not only aims to make education more affordable but also establishes a transparent and simplified application process.

To apply for a loan under the Students Loan Bill, prospective students must follow specific steps to initiate their applications. These steps include submitting their applications through their respective banks along with a comprehensive set of required documents.

Eligibility Criteria: Fulfilling the Conditions

Prospective students seeking a loan under the Students Loan Bill must satisfy the conditions outlined in Section 17 of the Act. The eligibility criteria are as follows:

(a) Admission into Accredited Institutions: Applicants must have secured admission into Nigerian universities, polytechnics, colleges of education, or vocational schools established by the Federal Government or any state government.



(b) Income Limit: The applicant’s individual or family income must not exceed N500,000 per annum.

(c) Guarantors: Each applicant must provide a minimum of two guarantors falling into one of the following categories: (i) Civil servants of at least level 12 in the service, (ii) Lawyers with a minimum of 10 years of post-call experience, (iii) Judicial officers, or (iv) Justices of the peace.

Disqualification Factors: Ineligibility for Loan Access

Under the Students Loan Bill, certain circumstances disqualify students from accessing the loan. These disqualifying factors include:

(a) Previous Loan Default: Students proven to have defaulted on any previous loans granted by any organization are disqualified from accessing the loan.

(b) Exam Malpractice: Students found guilty of exam malpractice by any school authority will be disqualified from receiving the loan.

(c) Conviction of Felony or Offenses of Dishonesty or Fraud: Students convicted of a felony or any offense involving dishonesty or fraud are ineligible for the loan.

(d) Drug Offenses: Students convicted of drug offenses are disqualified from accessing the loan.

(e) Parental Loan Default: Students whose parents have defaulted on a student loan or any other loan granted to them will be disqualified from receiving the loan.

Application Process and Documentation: Ensuring a Smooth Journey

The Students Loan Bill outlines the application process for prospective students seeking the loan. The application process involves the following steps:

Submission through the Applicant’s Bank: All applications must be submitted through the applicant’s bank to the Chairman of the Committee established under the Act. Accompanying the application should be a cover letter signed by the vice-chancellor, rector, or the head of the institution, along with the student affairs officer of the institution.

Required Documents: Each application must be accompanied by several documents, including a copy of the student’s admission letter. Additionally, a letter from the guarantors addressed to the Chairman of the Committee, recommending the student for the loan and accepting liability in the event of default, is required. The application should also include two passport photographs from each guarantor, information on the guarantors’ employment, proof of employment with the named organization, as well as particulars of the guarantors’ business registration or relevant authority if self-employed.

Application Status Communication: The Committee is obligated to communicate the status of the applicant’s application within 14 days of receiving it.

Efficient Loan Disbursement: Streamlining the Process

The Students Loan Bill sets out the process for loan disbursement, emphasizing timely processing. Processing of any applicant’s application and disbursement shall be completed within 30 days of the application reaching the Chairman of the Committee, subject to Section 18(4) of the Act. This ensures that loans are processed efficiently and promptly.

Responsible Repayment: Ensuring Sustainability

The repayment terms for beneficiaries of the loan are outlined in the Students Loan Bill:

Commencement of Repayment: Loan repayment shall commence two years after completion of the National Youth Service Corps program.

Salary Deduction: Repayment shall be facilitated through a direct deduction of 10% of the beneficiary’s salary at source by the employer. The deducted amount will be credited to the Fund.

Notification of Job Changes: In the event of a job change, beneficiaries are required to notify the Chairman of the Committee within 30 days of resuming employment with the new employer, providing details of the new job.

Self-Employed Individuals: Self-employed beneficiaries are required to remit 10% of their total monthly profit to the Fund.

Reporting of Self-Employment Status: Self-employed individuals assuming this status must submit relevant information, such as business name, address, location, registration documents (if applicable), bank details, partner names, and director/shareholder names, to the Committee within 60 days.

Penalties for Default: Defaulting on the provisions or aiding default is considered an offense and, upon conviction, is liable to a fine of N500,000 or imprisonment for a term of two years, or both. This underscores the importance of adhering to the repayment obligations outlined in the Act and discourages default or aiding default.

The loan repayment terms and penalties aim to ensure timely and responsible repayment, contributing to the sustainability of the loan program and the availability of funds for future students.

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