The Nigerian Education Loan Fund (NELFUND) has announced plans to tighten its student loan administration to prevent beneficiaries from receiving government-backed support while their parents continue paying their tuition fees.
NELFUND Managing Director, Akintunde Sawyerr, disclosed this on Wednesday during a press briefing, explaining that the agency had identified cases of students allegedly benefiting from the loan scheme while still relying on their parents to settle their school fees.
Sawyerr described the practice as unacceptable and said the fund was determined to address the problem through improved payment monitoring, transparency and better communication with students, parents and tertiary institutions.
He said the agency would introduce a system allowing parents to confirm whether their children’s school fees had been paid through NELFUND, without necessarily gaining access to the exact amount involved.
According to him, the measure would help parents establish whether the financial obligations they were meeting had already been covered by the government-backed loan scheme.
New Payment System to Prevent Double Payments
The announcement comes as NELFUND pilots a tokenised payment system designed to give students greater control over the payment of their approved institutional fees.
Under the proposed arrangement, students will be able to authorize payments directly to their institutions through a token linked to their respective schools.
The system is intended to prevent situations in which students pay their fees independently because they are unaware that NELFUND has already transferred the money to their institutions.
Such cases can result in duplicate payments and subsequent refund complications.
Sawyerr explained that the tokenised arrangement would restrict approved funds to the designated institution, preventing beneficiaries from transferring the money into personal bank accounts or redirecting it to another school.
NELFUND Executive Director, Mustapha Iyal, said the token was linked to a specific institution and was not a personal or mobile money wallet.
Nearly 400,000 Applications Recorded
Iyal disclosed that the pilot phase had received close to 400,000 applications, although the figure did not represent the number of applications already processed through the new system.
The fund also plans to organize re-education workshops across Nigeria’s six geopolitical zones to explain the revised payment procedures and address misunderstandings among students, parents and participating institutions.
NELFUND said the engagement would go beyond its usual awareness campaigns by helping stakeholders understand how institutional payments, upkeep allowances and payment receipts work.
Under the existing student loan arrangement, approved tuition and other institutional charges are paid directly to tertiary institutions, while approved upkeep allowances are transferred separately to students’ bank accounts.
The proposed tokenised system concerns the payment of institutional fees, rather than the normal transfer of upkeep allowances.
What the Changes Mean for Students and Parents
The new measures are intended to improve transparency and reduce confusion over who has paid a student’s fees.
Parents will be able to verify whether the relevant charges have been settled, while students will have a clearer role in authorizing payments to their institutions.
The changes are also expected to reduce refund disputes arising when students unknowingly pay fees that NELFUND has already covered.
However, the success of the arrangement will depend on effective coordination between the fund, students and tertiary institutions, particularly where schools impose strict deadlines for payment and registration.
NELFUND has not announced a specific date for the full implementation of the tokenised system.
The agency says its broader objective remains to improve access to higher education by easing financial pressure on eligible students while ensuring that public funds are properly managed.
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