FG to fund student loan scheme through education tax

The Federal Government on Monday said the Education Tax under the Federal Inland Revenue Service would serve as one of the funding sources for the recently established Student Loan Scheme.

It said the scheme would be fully automated to ensure zero human involvement in the application and processing of the loans to applicants.

“…that is why the education tax fund is one of the sources of funding that we will use to execute this programme,” said FIRS Chairman, Dr Zacch Adedeji, when he addressed State House Correspondents after briefing President Bola Tinubu on the impending launch of the scheme at the Aso Rock Villa on Monday.

Barely one week earlier, the Minister of State for Education, Dr Yusuf Sununu, revealed that the scheme was on track to go live in January 2024 as the President promised last October.

Adedeji, who spoke alongside the Executive Secretary of the Student Loan Board, Dr Akintunde Sawyerr, said channelling the education tax into the scheme is the administration’s way of being accountable to Nigerian taxpayers.

“This is in fulfilment of Mr President’s promise that we will make education accessible to all. This is one of the schemes where we will be applying the education tax that we collect.

“It is a way of being accountable to the taxpayer. Because the essence of education tax is to consolidate and restore education integrity and quality, in fulfilling that part of the Act, education tax fund is one of the sources of funding that we will use to execute this programme,” he said.

Meanwhile, the Executive Secretary of the Scheme, Sawyerr, who gave his first public briefing on the programme said eligible applicants would route their requests through the loan App or website, affirming that the scheme would be devoid of human involvement.

He itemised the application process, saying prospective candidates must avail their JAMB registration number, Date of Birth, National Identification Number and Biometric Verification Number, amongst others.

“The applicant will go on to a portal, or they will engage with the app. They will have to put in certain pieces of information that make them eligible, such as their JAMB number and, of course, the tie-in to their date of birth.

“Further pieces of information include their NIN, which confirms that they are Nigerians. This loan scheme is being paid for by Nigerian taxpayers. So, it’s for Nigerians and the NIN helps verify and qualify them as such.

“Their BVN is for financial inclusion because this scheme in itself will, at some point, be able to empower students, so we need to know they have bank accounts. We need to know where their accounts are to be able to access those accounts.

“It will also have their matric number and admission number so that we can firmly establish which institution they are going to because one of the key elements of this is that once we have received applications and those applications are approved, the fees or the tuition requirements in terms of financials will be transferred directly to the institution. That in itself has benefits for the institution,” The Executive Secretary explained.

While likening the loan to a bridge linking the desire for further education and the funds to do so, Sawyerr explained that the FG was keen to ensure that young Nigerians do not fail to acquire tertiary education simply because they lack the funds.

He said, “The intention behind it is to ensure that the reason for not being able to go on and further your education at a tertiary level is not for the lack of finance. This law seeks to bridge the gap between the desire to study and the capacity to go further. It seeks to bridge that gap that is created by lack of finance and funding.”

The Loan Chief explained that the scheme would enable Nigerians to pick a career trajectory of their choice rather than being forced into other paths because they were unable to acquire vital education.

He also affirmed that the loan would help to stem the dangerous journey undertaken by Nigerian youths across the Sahel to Europe in search of a better life.

“Some of the opportunities provided by the scheme include enrolling intending students in teacher training programmes and vocational skills.

“The program provides opportunities for Nigerian students who want to go into the academic side and get a university degree or perhaps want the technical side and acquire some vocational skills and also in the teacher training space.

“This intervention will affect the lives of many Nigerian youths because that’s usually the bracket to further their education. It will…enable us to intervene and support families, particularly the needy,” he explained.

The Executive Secretary disclosed that the school fees for successful applicants would be transferred directly to their institutions.

On June 12, 2023, President Bola Tinubu signed the Student Loan Bill into law. The move was in “fulfilment of one of his campaign promises to liberalise funding of education,” a member of the then Presidential Strategy Team, Dele Alake, told journalists. The law enables indigent students to access loans at interest-free rates.

Declaring the 29th session of the annual Nigeria Economic Summit in Abuja open on October 23, 2023, the President said, “By January 2024, the new Students Loan Programme must commence. To the future of our children and students, we’re saying no more strikes!”