A probe has accused certain universities and banks of unethical practices in the distribution of student loan funds.
The National Orientation Agency (NOA), via its community orientation and mobilization officers (COMO), stated that some higher education institutions may be colluding with banks to unfairly disadvantage students benefiting from the loan program.
Lanre Issa-Onilu, the director general of the NOA, shared these findings following a meeting with Akintunde Sawyerr, the managing director of the National Student Loan Fund (NELFund).
In a statement released on Sunday, Issa-Onilu noted that initial evidence indicates that university officials are withholding vital information about the release of loan funds, prompting NELFund to act swiftly.
The NOA mentioned that certain institutions, in collaboration with specific banks, have intentionally delayed payments to students who were successfully approved for loans for their own financial benefit.
It pointed out that some universities are neglecting to confirm the disbursements made by NELFund to the students.
Sawyerr corroborated these concerns during the meeting, mentioning that NELFund had identified instances where institutions directly received student loan funds but failed to inform the students or accurately document the payments.
“Recent findings from NELFund have indicated that some institutions have directly received student loan disbursements into their accounts but have not communicated this to the impacted students or recorded the payments in their financial accounts, causing unnecessary confusion,” Sawyerr stated.
“Concealing vital financial information from students is not only unethical but also violates the very principles on which NELFund was established. We are ready to initiate legal proceedings against any institution involved in such misleading practices.”
Issa-Onilu cautioned the implicated institutions and the cooperating banks, insisting that such actions must cease immediately.
He mentioned that the NOA has also directed its state directorates to collect additional feedback from students nationwide.
This is intended to ensure the federal government can take action against any offending schools and banks.
President Bola Tinubu introduced the initial version of the student loan policy in June 2023 to provide interest-free loans to students.
The scheme was set to begin in October 2023, but its implementation faced numerous delays until it was re-enacted in April 2024.
NELFund launched the loan application portal in May 2024, during which a pilot phase commenced for federal tertiary institutions.
Reports suggest that some students have faced delays in receiving their funds, even after approval.
This has resulted in situations where students approach exam deadlines or new academic terms without having received their loans.
There have also been discrepancies in the amounts disbursed compared to the actual tuition fees, leading to confusion regarding repayment responsibilities.
NELFund had previously threatened legal action against institutions that failed to provide disbursement information to student loan applicants.
