Nigeria’s student loan agency says the new payment system will give students greater control over tuition payments, reduce refund disputes and prevent approved funds from being diverted.
The Nigerian Education Loan Fund (NELFUND) has begun piloting a digital token-based payment system aimed at preventing students from paying their school fees twice under the Federal Government’s student loan scheme.
NELFUND Managing Director, Akintunde Sawyerr, disclosed this on Wednesday during a press briefing, saying the new system would allow students to authorise payments directly to their institutions using their mobile phones.
The initiative follows cases in which students paid their tuition fees themselves, only to discover later that NELFUND had already transferred the money to their schools.
According to Sawyerr, delays in communicating completed payments to beneficiaries had contributed to the problem, leaving some students making duplicate payments unintentionally.
He explained that a student could pay their fees to meet a school’s registration deadline without knowing that NELFUND had already settled the same bill.
“It was a genuine error, no suspicion, no accusation, just genuine error,” Sawyerr said, describing how the situation could arise.
How the new system will work
Under the proposed arrangement, students whose tuition payments have been approved will receive notifications on their phones and be able to authorise transfers to their designated institutions.
Unlike a conventional cash disbursement, the digital token will be linked to a specific school and restricted to the approved payment.
NELFUND says the system will prevent beneficiaries from transferring tuition funds into their personal bank accounts or redirecting the money to other institutions.
“We want to eliminate that need for refunds. So we’re placing the power of payment in the hands of the students,” Sawyerr said.
He added that the money would not be transferred until the student initiated the transaction.
The fund’s Executive Director, Mustapha Iyal, also clarified that the token would not operate as a personal or mobile money wallet but would be tied to the institution for which the payment had been approved.
Nearly 400,000 applications received
Iyal said the pilot phase had commenced, with the fund receiving close to 400,000 applications at the time of the briefing.
However, the figure represents applications received and should not be interpreted as the number already processed through the pilot system.
Officials did not announce a specific date for the system’s full implementation.
The initiative is expected to address one of the administrative challenges facing the government’s student loan programme, particularly when students pay their fees before loan disbursements reach their institutions.
Background to the student loan scheme
NELFUND administers the Federal Government’s student loan programme, established under the Students Loans (Access to Higher Education) Act, 2024, to improve access to tertiary education for eligible Nigerians.
The scheme provides loans to cover approved institutional charges and, where applicable, students’ upkeep expenses.
Under the existing arrangement, tuition payments are made directly to institutions, while approved upkeep allowances are paid into students’ bank accounts.
The new token-based mechanism is intended to improve payment transparency, reduce duplicate transactions and minimise disputes over refunds.
Its success will depend on effective coordination between NELFUND, students and tertiary institutions, particularly in ensuring timely notifications and accurate payment records.
For students who have struggled to recover money paid twice for their education, the proposed system could offer a more reliable way of managing tuition payments and reducing avoidable financial pressure.
