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By Tracy Moses
The House of Representatives has launched a probe into alleged irregularities and unethical practices in the disbursement of student loans under the Nigerian Education Loan Fund (NELFUND).
The decision followed the adoption of a motion of urgent national importance moved on Tuesday by Hon. Aliyu Mustapha, who represents Ikara/Kubau Federal Constituency of Kaduna State.
In presenting the motion, Mustapha raised alarm over alleged misconduct that threatens the credibility and transparency of the student loan scheme established by the Student Loans (Access to Higher Education) Act, 2024. The programme, which provides interest-free loans to eligible students across Nigeria, has already registered over 500,000 applicants and disbursed more than N54 billion.
Citing a report by the National Orientation Agency (NOA), the lawmaker alleged collusion between some tertiary institutions and financial institutions to delay, divert, or obscure student loan disbursements. He revealed that some schools reportedly received funds on behalf of students but failed to inform them or update their financial records, in violation of NELFUND guidelines.
Mustapha also referenced findings from the Federal Ministry of Education exposing unauthorized deductions from student loan payments by certain universities, describing these actions as a breach of public trust and a direct violation of the Student Loans Act.
He further highlighted lapses in the verification process, including inflated tuition fees submitted to the NELFUND portal, disbursements made to already-graduated students, and payments sent to institutions even after students had personally paid their fees.
“These abuses not only defeat the purpose of the student loan initiative but also risk denying thousands of deserving students access to higher education,” Mustapha warned. “If not urgently addressed, they could erode public trust in the scheme.”
Following deliberation, the House called on NELFUND to enhance its verification and monitoring frameworks by deploying robust IT solutions. Lawmakers also demanded sanctions against any institution found culpable of violating the Student Loans Act or its operational regulations.
Additionally, institutions that received disbursements for students who had already paid their tuition were directed to issue immediate refunds to the affected students.
To ensure accountability, the House mandated its Committees on Student Loans, Scholarships and Higher Education Financing; Banking and Other Ancillary Institutions; Anti-Corruption; and University Education to jointly investigate the alleged infractions. The committees are expected to report their findings within four weeks.