President Bola Tinubu, on Monday, signed into law a bill that provides interest-free education loans for Nigerians willing to pursue tertiary education.
The Access to Higher Education Act, 2023, or the Students Loan Act, is a significant step towards achieving educational equality and enabling more Nigerians to access higher education opportunities.
The History and Intent of the Act
The bill, first introduced in 2016 by Femi Gbajabiamila, the immediate past Speaker of the House of Representatives, was reintroduced in 2019.
It gained more attention from the National Assembly in November 2022, just a month after an eight-month-long industrial action by the nation’s university workers’ union, who were protesting poor working conditions, among other demands.
The Act establishes the Nigerian Education Loan Fund, which will handle all loan requests, grants, disbursements, and recuperations of the loans provided.
The goal is to help Nigerians fund their higher education, and beneficiaries are expected to pay in installments two years after participating in the NYSC program.
Education Loan Fund: Sources and Management
According to the Act, the Education Loan Fund will receive funding from various sources, including;
Profits from oil and other minerals, taxes, levies, and duties from the FIRS, Nigeria Immigration Service (NIS) and Nigerian Customs Service (NCS), education bonds and endowment fund schemes, as well as donations, gifts, grants, and endowment.
The Fund will be domiciled in the Central Bank of Nigeria (CBN) and managed by an 11-person special committee chaired by the CBN governor.
The committee comprises representatives from various sectors, including education, finance, universities, polytechnics, and colleges of education.
The committee will establish regulations and guidelines for managing, disbursing, and recouping students’ loans.
Eligibility and Application Process
The Act stipulates that only students of government-owned tertiary institutions are qualified to apply for the loan. To qualify, an applicant’s or family’s income must be less than N500,000 annually.
Applicants must also provide at least two guarantors, each of whom must either be a civil servant of at least level 12, a lawyer with at least ten years post-call experience, a judicial officer, or a justice of the peace.
Students can be disqualified from the loan if they have been found guilty of examination malpractice by any school authority, convicted of a felony or any offense involving dishonesty or fraud,
Also, if they or their parents have defaulted in respect of a student loan or any loan granted to them or have been convicted of drug offenses.
Repayment of the loan begins exactly two years after the completion of the participation in the NYSC program.
A beneficiary shall remit 10 percent of their income to the Fund at the end of every month. For self-employed individuals, 10 percent of their total monthly profit shall be remitted as part of the repayment plans.
Defaulters risk an N500,000 fine, two years jail term, or both when they fail to repay their loans.
The Way Forward
Implementing the Access to Higher Education Act 2023 signals a significant breakthrough for higher education in Nigeria.
The law is a beacon of hope for students facing financial constraints in their quest for tertiary education.
However, the effectiveness of the law will depend largely on its implementation, the robustness of the fund management, and the willingness and ability of beneficiaries to repay their loans.
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