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All You Need To Know About Newly Revised 2024 Student Loan Act
President Bola Tinubu recently signed the 2024 newly revised Student Loan Bill into law, thus repealing the earlier 2023 Student Loan legislation with immediate effect.
The new Student Loan Act also known as Access to Higher Education Act, 2024, aimed to address some of the loopholes of the previous Student Loan law while introducing new and comprehensive coverage for those seeking tertiary education or technical and vocational skills development.
Below are ten things to know about the 2024 Student Loan Act
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1) Establishment of NELFUND: First and foremost, the Act stipulates the establishment of the Nigeria Education Loan Fund (NELFUND) as a corporate body that can sue and be sued in its name and has the power to acquire, hold, and dispose of movable and immovable property for the purpose of its functions.
2) NELFUND to provide loans to qualified Nigerians for tuition, fees, charges, and upkeep: The fund is designed to offer loans to eligible Nigerians, covering tuition, fees, charges, and living expenses for their education in recognized higher education and vocational training institutions within Nigeria.
3) Set Up Structure for Funding NELFUND: The Act also stipulates the process and structure through which NELFUND will be funded. According to the 2024 Student Loan Act, the student loan program will be financed by allocating 1% of all taxes, levies, and duties that the Federal Inland Revenue Service (FIRS) collects and that go to the Federal Government, directing these funds to a General Reserve Fund.
4) Removal of Family Income Barrier: Prior to the enactment of the 2024 Student Loan Act, the family income of an applicant was a determining factor for loan approval. The applicant’s family income must not exceed N500,000 per annum. Under the revised law, however, this requirement has been removed, and family income will no longer be a prerequisite for eligibility for the student loan.
5) Removal of Guarantor Barrier: The 2023 Student Loan Act stipulated that an 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. The 2024 legislation has no such requirement.
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6) Loan to include Skill-development Programs: According to the 2024 Student Loan Act, application is not restricted to students in tertiary institutions alone, but also those seeking skill-development programs. The 2024 Act is inclusive to those who want to learn vocational or technical skill in a government-owned institution, but do not have the resources to do so.
7) Removal of Parents’ Loan History as a Prerequisite: The Act also stipulates the removal of parent’s loan history as a prerequisite for securing the loan for eligible candidates.
8) Beneficiaries to begin repayment 2 years after NYSC: The revised law also stipulates that the recovery process from beneficiaries of the loan scheme would commence two years after the National Youth Service Scheme (NYSC).
9) Punishment for filing false Statement to NELFUND: The newly revised Student Loan Act also stipulates punishment for those who provide false Statements to the Fund. Such a person under this section is guilty of a felony and is liable to imprisonment for three years.
10) Debt Forgiveness: Lastly, the Act offers a Debt Forgiveness clause in the event of death or acts of God causing inability to repay. In sum, the presidential spokesperson, Ajuri Ngelale, noted that the updated Act addressed the hindrances in the initial version, setting the stage for safeguarding Nigeria’s prospects. According to him, it makes it possible for citizens to fund their studies, learn vital skills, and play a role in national growth.