The Federal Ministry of Education has launched an investigation into alleged illegal deductions from the institutional fees paid by the Nigerian Educational Loan Fund (NELFUND) for beneficiaries of the Student Loan scheme.
Education Minister Dr. Tunji Alausa described the infractions in the loan disbursement as “very disturbing and extremely concerning.”
This is even as the Independent Corrupt Practices and Other Related Offences Commission (ICPC) announced that its men had launched a probe in the alleged infractions in the Student Loan management.
But the NELFUND has dismissed the allegation, saying no funds have been mismanaged, stolen, or unaccounted for under the scheme.
So far, N53 billion has been disbursed by NELFUND to students.
Upon approval of application, NELFUND pays directly the fees of the student to the university account while the student gets N20,000 monthly for upkeep.
But National Orientation Agency (NOA) Director-General Lanre Isa-Onilu raised the alarm about certain untoward activities around the payment in some of the universities. But this was dismissed as a product of minor technical glitches.
According to a statement by the Ministry’s Press and Public Relations Director, Boriowo Folasade, the minister has summoned an urgent meeting for May 6 with the vice chancellors of the affected institution and NELFUND’s Managing Director, Akintunde Sawyerr.
The statement said that the meeting will “thoroughly investigate the matter, ensure full accountability, and reaffirm the Ministry’s zero-tolerance policy toward financial malpractice in the education sector.”
The minister warned that unauthorised deductions from student loans not only breach financial ethics but also undermine the very foundation upon which NELFUND was established.
He stated that if proven true, such actions would constitute a gross violation of public trust and a betrayal of the government’s commitment to equitable access to education.
The statement reads: “To reinforce this effort, the Ministry, in collaboration with the Athena Centre, will launch a compliance-tracking initiative and a countdown webpage to monitor institutional transparency.
“They will also offer technical assistance and introduce an Annual University Transparency Index to promote accountability and enhance the global relevance of Nigerian universities.
“Additionally, a training programme will be organised for Bursars and ICT Heads of universities and polytechnics on the development and maintenance of an open-portal initiative.
“As part of our National Education Sector Reform Initiative (NESRI), governance remains the top pillar of our agenda.
“We are committed to strengthening transparency, promoting responsible financial conduct, and ensuring that every kobo allocated for student welfare is used appropriately.
“Let me assure Nigerians that this matter will not be swept under the carpet. Anyone found culpable will face appropriate sanctions.
“NELFUND was created to expand students’ access to high quality education and to support universities financially in a legal and sustainable way. Any attempt to exploit this fund is unacceptable and contradicts the President’s vision for inclusive human capital development.”
Confirming ICPC’s investigation of the alleged discrepancies in the disbursement of loans to students, ICPC spokesperson Debola Bakare said preliminary findings revealed a significant gap in the financial records of the disbursement process.
The Commission confirmed that its Chairman’s Special Task Force immediately swung into action upon receiving the report.
He said letters of investigation and invitations were dispatched to key stakeholders, including the Director General of the Budget Office, the Accountant-General of the Federation and senior officials from the Central Bank of Nigeria (CBN).
“Additionally, the Chief Executive Officer and Executive Director of NELFUND were invited to provide documentation and explanations relevant to the case, the statement said.
According to the Commission, the responses received were critically analysed and interviews were conducted with the concerned individuals.
On the strength of its investigation, ICPC revealed that the total money received by NELFUND as of March 19, 2023, was N203.8 billion.
The statement further reads: “The breakdown showed that N10 Billion was an allocation from the Federation Allocation Account Committee, N50 billion was from the Economic and Financial Crimes Commission, N71.9B was from the Tertiary Education Trust Fund, while another N71.9 billion was also from the same Tertiary Education Trust Fund.
“ICPC, however, found that the total amount disbursed to institutions from inception to date is about N44,200,933,649.00, while a total of 299 institutions have benefited from the funds released.
“To date, the total amount disbursed to 299 beneficiary institutions stands at approximately N44.2 billion, with 293,178 students having benefited from the fund.”
NELFUND denies mismanagement of scheme
The Nigerian Education Loan Fund (NELFUND) insisted that reports on alleged infractions in the management of the Student Loan were misleading and inaccurate.
It described the development as dangerous for the administration of the scheme.
NELFUND’s position was made known in a statement in Abuja by its Director, Strategic Communications, Mrs. Oseyemi Oluwatuyi.
The statement reads: “The reports, which suggested ‘misappropriation and mismanagement of funds, are entirely false, grossly irresponsible, and deeply damaging to the integrity of an institution established to deliver financial hope to millions of Nigerians.
“This is a coordinated distortion of facts that undermines public trust, weaponises misinformation, and threatens the credibility of a national intervention still in its infancy.”
According to NELFUND, no funds have been mismanaged under the scheme.
It added: “The scheme officially launched its student loan application portal in 2024. As of today, all institutional fees are paid directly to verified institutions, while upkeep allowances are disbursed to the verified bank accounts of eligible student applicants.
“The figures and funding amounts currently being misrepresented in the public are drawn from entirely different education financing interventions predating NELFUND’s operational commencement.
“They bear no relevance to the current student loan scheme and should not be falsely attributed to this institution.”
It noted that it operates a zero human interface, fully automated loan system that eliminates opportunities for financial misconduct.
The statement further reads: “Every application and disbursement is digitally tracked, time stamped and verifiable. “Our commitment to transparency and cooperation with oversight agencies, including the ICPC, is total and unwavering.
“We have complied fully with every request for information and will continue to uphold the highest standards of public accountability.”
The statement noted that the circulation of unverified, context-free, and inflammatory claims at the critical stage of implementation, “is not only reckless, but a deliberate sabotage of a nationally significant, people centered programme designed to expand access to tertiary education and economic mobility.
“We call on the media, stakeholders, and the public to resist the pull of sensationalism and await verified updates directly from NELFUND.
“We remain focused, undeterred, and committed to the transparent delivery of this national mandate. The future of Nigeria’s youth is too important to be hijacked by misinformation.”
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