FG Alleges Tertiary Institutions, Banks Colluding to Shortchange Student Loan Beneficiaries

Naija247News reports that the Federal Government has raised serious concerns over alleged collusion between some tertiary institutions and commercial banks to exploit students applying for government-backed loans.

Naija247news gathered that the revelation came during a press briefing in Abuja, where top officials from the Ministry of Education and the Nigerian Education Loan Fund (NELFUND) expressed displeasure over irregularities discovered in the student loan application process.

According to Naija247news, the federal authorities alleged that certain institutions are inflating tuition fees and collaborating with banks to deduct excessive charges, thereby reducing the actual amount disbursed to students. These actions, officials say, contradict the intent of the loan initiative designed to ease access to higher education for financially disadvantaged students.

Naija247news understands that a committee has been set up to investigate these practices, and the Ministry has vowed to take disciplinary action against any institutions or financial institutions found culpable.

“The programme was introduced to ensure that no Nigerian student is denied education due to financial constraints,” a senior official stated. “It is disheartening to discover that institutions and banks are taking advantage of the system.”

Naija247news reports that the student loan scheme, launched as part of President Bola Tinubu’s broader education reform agenda, was expected to streamline access to affordable education financing. However, concerns over transparency and misuse of the fund have emerged barely months into its implementation.

Affected students, according to Naija247news, have begun to voice their frustrations, citing unexplained deductions and receiving less than the approved amounts. Some students alleged they were coerced into opening specific bank accounts that attract hidden fees, which further diminish the actual funds they receive.

Naija247news gathered that NELFUND is currently auditing disbursement records and has called on students to report suspicious deductions or discrepancies during the loan process. The Fund is also working on revising its monitoring mechanism to ensure stricter compliance by participating institutions and banks.

Naija247news understands that if the allegations are substantiated, it could prompt policy reforms and possibly lead to sanctions against erring institutions and financial partners.

The government has reiterated its commitment to ensuring that the student loan programme achieves its goal of providing equal education opportunities and urged stakeholders to maintain integrity in the administration of the scheme.