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Everything You Need to Know About Student Loan Bill in Nigeria

Nigeria’s President Bola Tinubu has recently signed the Students Loan Bill into law, ushering in a transformative era for educational funding in the country. The Student Loan Bill aims to provide easy access to higher education for Nigerians through interest-free loans from the Nigerian Education Bank. This article will provide an in-depth understanding of the Student Loan Bill, outlining its provisions, application process, eligibility criteria, repayment terms, and the impact it is expected to have on the education landscape of Nigeria.

Overview of the Student Loan Bill:

The Student Loan Bill, officially known as “AN ACT TO PROVIDE EASY ACCESS TO HIGHER EDUCATION FOR NIGERIANS THROUGH INTEREST-FREE LOANS FROM NIGERIAN EDUCATION BANK ESTABLISHED,” was sponsored by Hon. Femi Gbajabiamila. The primary objective of the bill is to make higher education more affordable and accessible to Nigerian students. The bill establishes the Nigerian Education Bank, which will serve as the financial institution responsible for providing interest-free loans to eligible students.

Eligibility Criteria:

To apply for a loan under this Act, students must satisfy the following conditions:

  • Admission into Public Institutions: Students must have secured admission into any public Nigerian university, polytechnic, College of Education, or TVET school. This requirement ensures that the loans are targeted towards students pursuing higher education in recognized institutions.
  • Income Limit: Applicant income or family income must be less than N500,000 per annum. This provision aims to support students from economically disadvantaged backgrounds who may not have the financial means to afford higher education.
  • Guarantors: Applicants must provide at least two civil servants as guarantors. The guarantors should have a minimum of level 12 years in service or meet other specified criteria such as being a lawyer with at least 10 years post-call experience, a judicial officer, or a Justice of Peace. The presence of guarantors ensures the repayment security of the loans.
  • Loan Default and Parental Default: Students who have defaulted on previous loans or found guilty of exam malpractices, felony, or drug offenses will not be considered for the student loans. Additionally, students whose parents have defaulted on previous loans will also be excluded from loan eligibility.

Application Process

To apply for a student loan under the Student Loan Bill, students must follow a streamlined application process. The process involves the following steps:

  • Submission through Students Affairs Office: All applications will be submitted through the Students Affairs Office of each institution. The institution must provide a list of all qualified applicants accompanied by a cover letter signed by the Vice-Chancellor, Rector, or the head of the institution, along with the student affairs office. This centralized process ensures consistency and transparency in the application procedure.
  • Documentation: Along with the application, students will be required to submit relevant documentation, including proof of admission, income certificates, and the necessary forms signed by the guarantors. These documents will be crucial in assessing the eligibility of the applicants and processing their loan requests.

Repayment Terms:

The Student Loan Bill outlines the repayment terms for beneficiaries of the loan. The repayment process is structured as follows:

  • Commencement of Repayment: Any beneficiary of the loan shall commence repayment two years after completing the National Youth Service Corps (NYSC) program. This grace period allows graduates to establish themselves in the job market before beginning loan repayment.
  • Repayment through Salary Deduction: Repayment shall be made through direct deduction of 10% of the beneficiary’s salary at the source by the employer. This ensures a convenient and automatic repayment process for employed beneficiaries. The deduction will be made from the beneficiary’s salary on a monthly basis.
  • Self-Employed Beneficiaries: For self-employed beneficiaries, they shall remit 10% of their total profit monthly to the Students Loan account prescribed by the Bank. This provision ensures that even self-employed individuals contribute towards the repayment of their loans. Self-employed beneficiaries will be responsible for remitting their monthly repayments on time.

The Impact on Education in Nigeria:

The implementation of the Student Loan Bill is expected to have a significant impact on the education landscape of Nigeria. By providing interest-free loans, the bill will make higher education more accessible to students from economically disadvantaged backgrounds. It will enable deserving students to pursue their educational aspirations without the burden of exorbitant tuition fees.

The streamlined application process and eligibility criteria ensure fairness and transparency in the selection of loan beneficiaries. This will encourage more students to apply for loans and take advantage of the opportunity to further their education.

Furthermore, the repayment terms of the loans are designed to be manageable for beneficiaries. The grace period after completing the NYSC program allows graduates to find employment and settle into their careers before beginning loan repayment. The salary deduction and self-employment repayment options provide flexibility and convenience for borrowers to fulfill their repayment obligations.

Overall, the Student Loan Bill represents a significant step towards making higher education more accessible and affordable for Nigerian students. It demonstrates the government’s commitment to investing in education and empowering the youth with the necessary resources to pursue their academic dreams. With the implementation of the bill, it is expected that more students will be able to access quality higher education, contributing to the socio-economic development of the nation.


The Student Loan Bill paves the way for a brighter future for Nigerian students by providing interest-free loans and streamlining the loan application and repayment processes. With a focus on affordability and accessibility, the bill addresses the financial barriers that many students face when pursuing higher education.

By expanding educational opportunities, the bill will contribute to the overall development of the country by equipping the youth with the skills and knowledge needed to thrive in their careers. The Student Loan Bill marks a significant milestone in Nigeria’s education sector and sets the stage for a more inclusive and prosperous future.