How to get federal government student loans for Nigerian students 

The much anticipated Student Loan Bill was enacted into law by President Bola Tinubu on Monday, June 12, 2023.

Femi Gbajabiamila, the outgoing speaker of the House of Representatives, presented the measure that will provide Nigerian students access to interest-free loans. 

The new

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If you are a student in a publicly owned tertiary institution in Nigeria, the question on your mind right now would be, "How can I get the federal government student loans for Nigerian students"?

The law clearly states the criteria students must meet to qualify to get federal government student loans for Nigerian students.

Below are some of those criteria:

How to get federal government student loans for Nigerian students

To apply for a loan under the Students Loan Bill, prospective students must satisfy the conditions outlined in Section 17 of the Act.

You must have:

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(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. The guarantors must fall 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.

What can disqualify you from getting federal government student loans for Nigerian students?

Under the Students Loan Bill, certain circumstances can disqualify you as a student from accessing the loan. These disqualifying factors include:

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

(b) Exam Malpractice: If you a a student is found guilty of exam malpractice by any school authority, they will be disqualified from receiving the loan.

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

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

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

These disqualification criteria ensure that the loan is allocated to students who meet the necessary ethical standards and have a genuine commitment to their academic pursuits.

Now that you know the criteria for applying for a student loan, you may want to know the process of apply for the loan.

How to apply for the federal government student loan for Nigerian students

The application process for the new student loan involves the following steps:

1. 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.

2. A cover letter signed by the vice-chancellor, rector, or the head of the institution, along with the student affairs officer of the institution, should accompany the application.

3. Required Documents: Each application must be accompanied by several documents, including a copy of the student’s admission letter.

4. 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.

5. The application should also include two passport photographs from each guarantor, information on the guarantors’ employment and proof of employment with the named organization, as well as particulars of the guarantors’ business registration or relevant authority if self-employed.

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

How will the federal government student loan be disbursed?

The Students Loan Bill also sets out the process for loan disbursement:

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.

How do I repay the federal government student loan for Nigerian students?

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.

What will happen if I do not repay the federal government loan for Nigerian students?

Any individual who defaults on the provisions of subsection (5) or aids in such default commits an offense and, upon conviction, is liable to a fine of N500,000 or imprisonment for a term of two years, or both.

This emphasizes 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.

Experts in the higher education field have claimed that with the creation of an education bank, tertiary institutions in Nigeria owned by the Federal Government may now be free to enact tuition charges. However, other experts have also proposed for an education grant instead of a loan that may not be accessible to the poorest students. 

Disadvantages of the federal government student loans for Nigerian Students

Strict Eligibility Requirements

The Student Loan Bill has strict rules about who can qualify for a loan. Some people are worried that these rules might make it harder for deserving students to get loans if they don't have the right kind of job or profession. 

It's important to find a balance between being careful with loan allocations and making sure everyone has a fair chance.

This might mean checking the rules regularly and making changes if needed.

Difficulties in Repaying Loans

Even though the loan terms are flexible, graduates might have trouble paying back their loans if they can't find a job or start a profitable business. 

This could lead to not being able to pay the loan back, which can have long-term consequences like having bad credit, fear and even mental health issues.

To make sure the loan program works well and lasts, it's important to help people who are struggling to pay and offer different ways to repay the loan.

Consequences for Not Paying Back

The Student Loan Bill has strict punishments for people who don't pay back their loans or help others avoid paying. While the goal is to make sure people pay what they owe, some people think that the punishments, like going to prison or paying big fines, might be too harsh. 

It's important to find a balance between holding people accountable and creating an environment where borrowers can get support and recover. This might mean looking at the rules and making changes when necessary.

Advantages of the federal government loan for Nigerian Students

More Accessible Education

The Student Loan Bill helps students from all backgrounds by offering interest-free loans. This removes the financial obstacles that often stop talented individuals from going to college or university.

With more accessible access to affordable money for education, deserving students can confidently pursue their studies and reach their full potential.

Equality in Education

The Student Loan Bill is committed to providing equal opportunities for everyone. It makes it clear that no one can be treated unfairly because of their gender, religion, tribe, position, or disability. 

This means that people from all parts of Nigeria have a chance to succeed in education and contribute to the country's future.

Flexible Loan Repayment

The bill understands that new graduates face challenges when they start their careers. It gives them a two-year period after finishing their National Youth Service Corps (NYSC) program before they have to start repaying their loans. 

They have options for paying back automatically from their salaries or contributing a percentage of their profits if they're self-employed. This makes it easier for borrowers to handle their loan payments responsibly.

Nigerian Education Bank

The heart of the Student Loan Bill is the creation of the Nigerian Education Bank. This bank is managed by a group of respected experts in academics, law, and government. They oversee and organize the loan program, making sure it runs smoothly. 

With the help of this centralized bank, students can navigate the loan process more easily. They can get important guidance and support throughout their educational journey.

Here are some of the other frequently asked questions about student loans in Nigeria:

Is it possible to get a student loan in Nigeria?

Yes, it is possible to get a student loan in Nigeria. With the new federal government loan foro Nigerian students, eligible indigenous students can access loans from the federal government and pay their school fees. They can repay their loans after graduation.