NELFUND Unveils Plan for Student Loan Repayments After Graduation

The Managing Director of the Nigerian Education Loan Fund (NELFUND), Akintunde Sawyerr, stated yesterday that graduates who benefit from the Fund will be required to begin repayment two years after completing their National Youth Service Corps (NYSC) programme.

Sawyerr clarified that if, after these two years, a beneficiary remains unemployed, NELFUND will, as much as possible, link them to job opportunities via a dedicated portal. He explained that, once employed, 10 per cent of their earnings would be deducted by their employers to offset the loan.

“If a student or a loanee has graduated, two years after they complete their NYSC, there is some obligation for them to start paying the loan back if they have a job. It makes sense in the value chain that we should assist in the process of helping people get jobs.

“We don’t create jobs. What we can do is connect people with jobs. One of the things we intend to do is set up a portal to attract vacancies and jobs, connect them with students who have loans, and help them secure employment so they can repay their loans.

“It’s in their interest and the interest of NELFUND to make this connection. And it’s a very small investment for us to make, given the potential value that it brings back to the students,” Sawyerr, who spoke on Arise Television, said.

He also rejected suggestions that the scheme operates on the ‘man knows man’ basis, stressing that no applicant needs personal influence to access the loan, aside from the standard verification checks during the application stage.

Providing current figures, Sawyerr disclosed that as of yesterday morning, 724,000 students had applied for the facility, with 449,000 already approved as beneficiaries.

“A beneficiary is somebody whose fees have been paid and in some cases, have had their fees and the upkeep provided to them. So 449,000 people are in that category. Talking further around the numbers, the 449,000 beneficiaries are from 218 institutions.

“Tertiary institutions at the federal or state government level, N47 billion paid to those institutions on behalf of these 449,000. It’s impossible to apply twice. And finally, the upkeep, we have paid N38 billion,” he stated.

On the risk of defaults, he explained that NELFUND has introduced safeguards to ensure that only individuals who can be traced are given loans, using identifiers such as BVN, bank accounts, and other records.

“The president was very careful with this. He didn’t want students to be penalised for taking a loan to go and get an education. So the obligation to pay the loan back is on the employer. When an employer employs someone, they go to a database to identify whether the person they’re employing has a loan with the NELFUND or not.

“If they have a loan with the NELFUND, the employer is obliged to deduct 10 per cent with the permission of the consent of the employee. 10 per cent of those fees, of their salary or their wages, depending on whether they’re doing weekly work or monthly work, can then be remitted to the NELFUND account.

“But the obligation is on the employer, not on the student. Unless, of course, the student or the loanee, rather, is self-employed, in which case they have an obligation to pay that 10 per cent,” he explained.

He added that in situations where students have already paid fees which NELFUND has also covered, such amounts must be refunded, and that some institutions are already taking steps to do so.

“The institutions have been making great strides to refund some of this money to students. Some are slower than others. It’s also important to recognise that there’s a cost to returning funds.

“So some of them have returned funds short of what was paid to them because there’s a charge. These are administrative issues. They’re not a big deal. They’re administrative issues which, over time, will be smoothed over.

“NELFUND is working very closely with the institutions and with the students to smooth these over. These are things that we must experience. We must go through them. There are teething problems,” he added.