Recently the president of Nigeria H.E Mr. Ahmed Bola Tinubu signed into law the student loan bill to encourage students who want to further their education to higher institutions but don’t have the financial strength to do that.
But the question now is, who is eligible to apply? What’s the repayment plan? And how much is a student expected to receive? These and many other related questions are what we shall be addressing in this article. Let’s go through it together.
All You Need To Know About The New Student Loan
Upon the assumption of office, President Tinubu signed into law the Student Loan Bill on 12th, June 2023(Higher Education Act 2023).
It would be recalled that the bill establishing student loans was first introduced in 2016 by the Speaker of the House of Representatives, Femi Gbajabiamila but it didn’t receive the needed attention hence the reintroduction of the bill in 2019. However, it was in 2022 that it received more attention in the National Assembly.
Few days into office, President Tinubu signed the bill into law which now gives rise to the Education Loan Fund.
The loan is designed such that students can borrow money and fund their education. The loan will be repaid in installments after two years of completing the NYSC program.
Requirements For The New Student Loan In Nigeria
For a student to be able to qualify for this loan, the student is expected to meet some eligibility criteria. Some of the criteria are outlined below:
- The student must be in any of the Nigeria public higher institutions like University, Polytechnic, College of Education, Vocational schools etc.
- The applicant must’ve passed the entrance examination of the intended public institution.
- The applicant’s income or the family’s income must not be more than N500,000 yearly.
Apart from the above requirements, the intending applicant is also expected to present two guarantors with the following qualification:
- A lawyer with at least 10 years post-bar experience and above.
- A senior civil servant at level 12 and above.
- A qualified judicial officer.
- Or a justice of peace.
Additionally, the Act also stipulates that a student under the loan scheme will be disqualified from accessing the loan if indicted of examination malpractice by the school board, or if the applicant commits any other offense that contravene the law.
How To Apply For Tinubu Student Loan?
After going through the eligibility and you met the criteria, the next thing is to apply for the loan.
To do that, follow the steps below:
1. Institutional Approval
- You’re expected to submit your loan application through the office of the student’s affair of your institution.
- If your application is approved, the head of your institution will give you a cover letter.
2. Arrange Your Documents
- Attach a copy of your admission letter to the cover letter.
- Attach the two letters from your guarantor that are addressed to the chairperson of the committee.
- Attach two passports photograph each from the guarantors.
- Add the evidence of employment of your guarantors.
3. Submission Of Application
- Visit any of the designated banks for the student’s loan program.
- Submit your application through the chairperson of the CBN-governor-headed committee through their respective banks.
4. Processing & Approval
Your application will be processed within two weeks(14 days) and if your application is successful, you’ll be communicated while the money will be disbursed to you when the funds are available.
FG’s Student Loan Repayment Plan
The beneficiaries who took the loan are expected to repay the loan after two years of completing their mandatory National Youth Service Corps program.
The repayment plan is designed such that a 10% deduction will be made from the beneficiary’s monthly earnings. It is grouped below:
1. Deduction Of Salary: The 10% deduction will be made from the beneficiary’s salary source and it will be credited to the education fund.
2. Self-Employed Beneficiary: The beneficiaries are required to remit 10% of their monthly profit to the education fund. Meanwhile, the self-employed beneficiary is expected to have submitted vital information to the education fund commission within two months before assuming this self-employed status.
What Will Happen If You Don’t Repay The Student Loan?
The Act stipulates that if a beneficiary defaults to repay the loan, and if convicted of contravening the Student Loan Act, such person is liable to pay a fine of N500,000, two years imprisonment or both depending on the magnitude of the offense.
Guide On How To Achieve Successful FG’s Student Loan Application
Since many students across Nigeria will be applying for this loan, it is safe to say that the process will be very competitive hence it is important to make your application unique to enable you to get the loan. The guide below will be of immeasurable help to you. They include;
- Ensure that you provide all the relevant documents.
- Get good guarantors with track records.
- Apply for the loan once you get admission.
The student loan is a good development for Nigerians who wish to further their education to a higher level. Getting the loan is pretty easy and the repayment plan is flexible.
However, ensure that you meet the eligibility criteria before applying for the loan to achieve success. Best of luck as you apply for the loan.