By all indications, Nigeria’s student loan scheme, managed under the Nigeria Education Loan Fund (NELFUND), was designed to be a lifeline. It was an ambitious attempt to give underprivileged students a shot at tertiary education without the crushing burden of tuition. Yet, true to a now predictable pattern, the initiative is fast becoming a case study in how systemic mismanagement and impunity continue to undermine public trust in educational funding.
The recent investigation launched by the Independent Corrupt Practices and Other Related Offences Commission (ICPC) into alleged discrepancies in the disbursement of student loans seems to be wake up call. But how many times have we been startled awake, only to roll back into collective amnesia?
According to media reports, 51 tertiary institutions were accused of making unauthorized deductions ranging from N3,500 to N30,000 from each student’s institutional fees funded by the loan. While this amount may appear negligible to some, to a struggling student, that’s the difference between textbooks or an extra meal. And when multiplied by hundreds of thousands of students, these so-called “minor deductions” become a multi-million-naira racket.
More alarming is the revelation that although N203.8 billion had been received by NELFUND as of March 2024, only N44.2 billion has been disbursed to 293,178 students across 299 institutions. That leaves a gaping N159.6 billion unaccounted for.
The ICPC Dilemma
To make this more interesting, the ICPC has announced that “a clear case of discrepancies has NOT been established.”
This is where we all collectively and individually ask: what constitutes a “clear case” when nearly 80% of received funds have not reached the intended beneficiaries?
This isn’t an isolated case. Its actually a tired script we’ve seen in other educational interventions.
In 2018, the Universal Basic Education Commission (UBEC) flagged over N90 billion in unutilized funds by state governments. In 2020, during COVID-19 lockdowns, palliatives earmarked for student support largely vanished or were diverted with little accountability. And just last year, the Tertiary Education Trust Fund (TETFund) revealed that over N300 billion in infrastructure funds remained underutilized or mismanaged by universities.
What happens next usually follows a familiar arc. Public outrage, panel investigations, press statements, and then, silence.
The ICPC’s current investigation, while necessary, already shows signs of being consumed by bureaucracy. Letters have been sent, interviews conducted, and yet no consequences have emerged for institutions reportedly exploiting students. Without enforcement, the noise fades, replaced by the next scandal in Nigeria’s crowded headlines.
We Can Do Better
The issue isn’t the idea of student loans; it’s the execution. Countries across the world run student loan programs with varying degrees of success. The United States, India, South Africa, and the UK all offer public loan schemes. But what sets them apart is the infrastructure built around transparency, monitoring, and digital disbursement systems that leave little room for manual exploitation.
If Nigeria wants to avoid turning NELFUND into another cautionary tale, a few steps are necessary:
- Digitize Disbursement: Use blockchain or a centralized digital ledger to track every naira from federal release to institutional deposit. Students should receive real-time SMS or email notifications of fund movement.
- Independent Oversight Board: Constitute a multi-stakeholder committee. This committee should include students, civil society organizations, and anti-corruption agencies. Apart from this, they should provide quarterly public audits of loan disbursements.
- Whistleblower Protections and Incentives: Encourage students and staff to report illegal deductions or misuse with guaranteed anonymity and possible financial incentives.
- Publish Beneficiary Lists and Amounts: Transparency works when the public can verify who got what. If 293,178 students received N44.2 billion, we should see the breakdown.
- Tie Disbursement to Performance Metrics: Institutions involved in unauthorized deductions should face immediate suspension from future loan cycles until restitution is made.
- Legal Consequences: Enough of the “no clear case established” narrative. Prosecutions must follow proven malfeasance. Until someone is held accountable, the rot will persist.
Nigeria is not the first nation to implement a student loan scheme, and it shouldn’t be the first to destroy public faith in it. This initiative can still work. It can become a model for equitable access to education. But first, we must decide as a country: are we serious about using education as a tool for progress, or merely a pipeline for profiteering?
Leave a Reply