To reduce duplicate transactions, avoid unnecessary refund requests and improve accountability in the administration of the student loan scheme, the Nigerian Education Loan Fund (NELFUND) has introduced a tokenised payment system to prevent students from paying their school fees twice.
This development was disclosed by the Managing Director and Chief Executive Officer of NELFUND, Akintunde Sawyerr, on Wednesday during a press briefing, explaining that the new arrangement would allow students to authorise payments directly to their institutions through their mobile phones.
According to him, the system is designed to address situations in which students unknowingly pay school fees that NELFUND has already settled on their behalf because they were not promptly informed of the initial payment.
Explaining further, Sawyerr stressed that delays in communicating completed transactions had created unnecessary financial and administrative difficulties for students and their institutions.
“We want to eliminate that need for refunds. So we're placing the power of payment in the hands of the students,” he said.
Under the proposed arrangement, students whose institutional fees have been approved will receive notifications prompting them to authorise payments through their phones.
Rather than transferring the approved tuition fees directly to institutions without the students initiating the transactions, the tokenised system will allow beneficiaries to authorise payments to their designated schools.
Sawyerr stressed that the arrangement would not give students unrestricted access to the loan funds. “We're not giving the students money, but we're giving them power,” he said.
Furthermore, he stated that the system would restrict the funds to the institution for which the payment had been approved, preventing beneficiaries from transferring the money to personal bank accounts or redirecting it to other schools.
“If they don't push the button, the money doesn't go anywhere. It will never be able to be transferred to the personal account of the student or anybody else,” Sawyerr said.
NELFUND Executive Director, Mustapha Iyal, also clarified that the token was linked to a specific institution rather than a personal or mobile money wallet. Iyal said, “It's not a personal wallet, it's not a mobile money wallet at all.”
He explained that the arrangement was intended to ensure that institutional fees could only be directed to the school designated for the approved payment.
Iyal disclosed that the pilot phase of the system had commenced, with close to 400,000 applications received under the ongoing process.
However, he did not establish that all the applications had been processed through the new payment arrangement.
The pilot is expected to help NELFUND address payment-related challenges while improving coordination between students, the fund and tertiary institutions.
The development comes as the agency continues implementing the Federal Government's student loan programme, established under the Students Loans (Access to Higher Education) Act, 2024, to expand access to tertiary education for eligible Nigerians.
Under the scheme, approved institutional charges are paid to students' institutions, while upkeep allowances, where requested and approved, are paid separately to beneficiaries.
The distinction means that the new tokenised arrangement primarily concerns the authorisation and payment of institutional fees, rather than unrestricted access to students' upkeep allowances.
The introduction of the tokenised system follows concerns about students receiving loan support while their parents continue paying their school fees, sometimes because families are unaware that NELFUND has already covered the charges.
In a separate report, Punch newspaper quoted Sawyerr saying the fund would take steps to address cases of beneficiaries allegedly receiving support through the scheme while still relying on their parents to pay their tuition fees.
The NELFUND chief said the agency intended to improve transparency and ensure that students, parents and institutions understood how the payment arrangements worked.
The fund also plans to conduct re-education workshops across Nigeria's six geopolitical zones to explain the changes and address misunderstandings surrounding institutional payments and upkeep allowances.
Sawyerr said the exercise would go beyond conventional public awareness campaigns by helping stakeholders understand the revised processes and their responsibilities.
The effectiveness of the new system will depend on how well students, institutions and NELFUND coordinate payment authorisation, transaction confirmation and school-fee records.
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