Students Loan: What You Need To Know About New Bill

Less than a year after President Bola Tinubu signed the Students Loan Bill into law, the legislation has been returned to the National Assembly for a complete overhaul. Following eight months of struggles to implement the law, marked by several missed deadlines, President Tinubu forwarded a bill to the National Assembly seeking a repeal and re-enactment of the bill.

Inclusion of All Students:

One significant change proposed in the amendment is the inclusion of all students. The current Act limits loan eligibility to tuition fees only, excluding federal university students who don’t pay tuition. The proposed bill expands the scope to cover fees, charges, and upkeep during studies, ensuring broader access to tertiary education.

Transfer of Operational Powers:

The proposed bill aims to transfer operational powers from the CBN governor to the Managing Director of the Fund. This shift is intended to streamline administration and align responsibilities with the core mandates of respective institutions.

Removal of Guarantors:

Another notable change is the removal of guarantors as a condition for loan qualification. Currently, applicants must provide two guarantors meeting specific criteria, which often pose challenges for many students. The proposed bill seeks to ease this requirement, making the loan more accessible.

Ban on Children of Defaulters:

The proposed bill eliminates the provision that disqualifies children of defaulters from accessing loans. This move aims to prevent penalizing students based on their parents’ financial history, promoting fairness and equal opportunities.

Commencement of Payment:

Under the current Act, loan repayment begins two years after completing the National Youth Service program, without consideration for employment status. The proposed bill suggests initiating repayment as soon as beneficiaries secure employment, reflecting a more realistic approach to loan recovery.

Loan Forgiveness:

The proposed bill introduces provisions for loan forgiveness in case of death or circumstances preventing repayment. This compassionate measure acknowledges unforeseen events affecting individuals’ ability to repay and offers relief through forgiveness or extension options.