*Benefits Of Applying For Nigerian Students Loan
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The signing of the Student Loan Bill into law by President Bola Tinubu on Monday has elicited commendations from the public, especially students.
The bill will enable Nigerian students access loans at interest-free rates.
It is also expected to see the establishment of an education bank.
In November 2022, the bill was passed by the National Assembly.
The bill was sponsored by Hon Femi Gbajabiamila.
A checks shows the bill seeks the establishment of the Nigerian Education Bank, which shall have powers to supervise, coordinate, administer, and monitor the management of student loans in Nigeria
The board will also receive applications for student loans through higher institutions in Nigeria on behalf of the applicants, screen the applications to ensure that all requirements for the grant of students’ loan under the Act are satisfied.
In the copy sighted by The Nation, “The bank shall also have the powers to approve and disburse the loan to qualified applicants; control and monitor and coordinate the students’ loan account/fund and ensure compliance in respect of disbursement; monitor academic records of grantees of the loan to obtain information on their year of graduation, national service, employment to ensure that grantees of the loan commence repayment of the loan as at when due, among other functions.
“The Bill provides that notwithstanding anything to the contrary contained in other enactments, all students seeking higher education in any public institution of higher learning in Nigeria shall have an equal right to access the loan under this Act without any discrimination arising from gender, religion, tribe, position or disability of any kind.
“The loan referred to in this Act shall be granted to students only for the payment of Tuition fees. The grant of the loan to any student under this Act shall be subject to the students/applicant(s) satisfying the requirements and conditions set out under this Act.”
Here are things to know before applying for student loan:
1. Students applying for loan must apply to the Chairman of Nigerian Education Bank through their respective institutions.
2. They must have secured admission into any of the Nigerian Universities, Polytechnics, Colleges of Education or any vocational school established by the Federal Government or the government of any state of the Federation.
3. Applicant must provide at least two guarantors.
4. Each of the guarantors must be a civil servant of not less than level 12 years in service, or a lawyer with at least 10 years post-call experience; of a judicial office of a justice of peace.
5. All applications from every institution must be submitted through the Student Affairs Office of each institution via a list of all qualified applicants from the institution accompanied by a cover letter signed by the vice-chancellor or rector or the head of the institution and the students affairs officer and addressed to the chairman of the board of the bank.
Each application must be accompanied by the following:
1. Copy of student’s admission letter
2. Letter by the guarantors addressed to the chairman, governing board of the bank recommending the student for the loan and stating that he accepts the liability in the event of default.
3. Each guarantor must submit two passport photographs, name of the employer and evidence of being so employed by the named organisation.
4. Each institutions must ensure that all applications from its school reach the bank not more than 30 days after close of admission for the academic year.
5. Where the guarantor is self-employed, he must provide particulars of his business as registered with the CAC or any other appropriate authority.
A student can be disqualified from accessing loan if:
1. He is proven to have defaulted in respect of any previous loan granted by any organisation.
2. He has been found guilty of exam malpractice by any school authority.
3. He’s convicted of felony or any office involving dishonesty or fraud
4. He has been convicted of drug offenses
5. Any of his parents has defaulted in respect of student’s loan or any loan granted to him or her.
For repayment of the loan:
1. Any beneficiary of the loan shall commence repayment two years after completion of NYSC
2. Repayment shall be by direct deduction of 10% of the beneficiaries salary at source by that employer and credited to the students loan account.
Here are some of the key benefits of applying for a student loan:
1. Access to education: Student loans provide access to educational opportunities that may otherwise be financially out of reach. They can cover tuition fees, books, supplies, and other educational expenses, allowing students to focus on their studies without worrying about immediate financial constraints.
2. Flexible repayment options: Many student loans offer flexible repayment options, including deferred repayment while still in school or grace periods after graduation. This flexibility can provide students with the necessary time to find employment and establish a stable financial foundation before beginning repayment.
3. Enhance career prospects: Higher education is often associated with improved career prospects and higher earning potential. By pursuing a student loan and investing in your education, you may increase your chances of obtaining a degree or certification that can lead to better job opportunities and higher income in the long run.
4. Financial flexibility: Student loans can provide temporary financial relief for students who may not have sufficient savings to cover their educational expenses. By using a student loan, individuals can allocate their available funds for other essential living expenses or personal investments.
5. Tax Benefits: In some countries, student loan interest payments may be tax-deductible, providing potential tax advantages. It is important to consult with a tax professional or financial advisor to understand the specific tax implications in your country or region.
It is important to note that while student loans can provide numerous benefits, they should be approached with caution.
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