In a recent development regarding the disbursement of the students’ loan scheme, President Tinubu on Thursday wrote to the National Assembly, proposing new changes to the students Loan bill.
The president has requested a repeal and reenactment of the Act, which was signed into law by his predecessor, Muhammadu Buhari.
The Act which was hurriedly bandied to pave way for Nigerians to have access to education loan ran into troubled waters which made it inoperable.
Yet, having aroused public consciousness as to the importance of the Act, the president has approached the National Assembly for a repeal and reenactment, making adjustments to key provisions while also seeking some sections are expunged.
Prominent among the new changes on the proposed (Repeal and Re-Enacment) Bill 2024 is that it removes the guarantor requirement so that students can apply for and receive loans subject to application and identity verification guidelines as provided by the fund.
Whereas, under the current Act, applicants are required to provide two guarantors who shall be a civil servant of level 12 and above, a lawyer with ten years post-call experience, a judicial officer, or a justice of peace.
The current bill also provided for only applicants with a combined family income of less than N500,000 per annum to apply for the loan.
Also, the child of a person who earns N45,000 per annum is disqualified from applying for the loan
The current Act also criminalises failure to repay loans obtained from the fund without consideration for circumstances, including unemployment, death, or disability, that may affect an individual’s ability to pay
However, under the new changes (Repeal and Re-enactment) bill 2024, provision for loan forgiveness in the event of death or acts of God causing inability to repay is provided.
Also, only a person who provides a false statement to the fund under those sections is guilty of a felony and is liable to imprisonment for three years.
The New Act also allows a beneficiary to request an extension of enforcement action by the fund by providing a sworn testament indicating that he is not employed in any capacity and is not receiving income.
Furthermore, the current Act forbids students from applying for loans to cover those other institutional charges apart from fees or their upkeep, thus defeating the purpose of the loan, which many critics said defeated the essence of the fund which was to create easy access to tertiary education for young Nigerians.
The new change however allows applicants to the fund to apply for loans to cover tuition and other fees payable to the school and maintenance allowance payable to the student.
Similarly, the current Act imposes on the Governor of the CBN management and executive responsibilities outside the core mandate of the CBN, which should be the Governor’s focus.
However, the New legislation establishes 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.
This allows that the fund can legally enter contracts, including loan agreements and may also initiate action to ensure repayment by beneficiaries.
