The Nigerian Education Loan Fund, NELFUND, has begun piloting a token-based payment system that will allow students to authorise payment of their tuition directly to their institutions to prevent duplicate payments and refund challenges.
Managing Director of the fund, Akintunde Sawyerr, disclosed this during a press briefing on Wednesday.
Sawyerr said the new system will give beneficiaries greater control over when their approved fees are paid while ensuring the money cannot be diverted to personal accounts or other schools.
“We want to eliminate that need for refunds. So we’re placing the power of payment in the hands of the students,” he said.
He explained that some beneficiaries had paid their fees without knowing NELFUND had already transferred the money to their schools, leading to double payments.
“We discovered that there were some issues with students being informed in good time that their payments had been made by NELFUND, which meant that some of them would pay because they hadn’t realised that NELFUND had paid already,” Sawyerr said.
According to him, in some cases schools received payment on Monday, but students who had not been notified paid again on Wednesday and only discovered later that NELFUND had settled the bill.
“It was a genuine error, no suspicion, no accusation, just genuine error,” he said.
Under the new arrangement, students will be notified when their approved tuition is ready and will use a mobile application to authorise payment through a digital token linked to their institution.
Sawyerr stressed that students will not have unrestricted access to the funds.
“We’re not giving the students money, but we’re giving them power,” he said.
“The system, the token, not only can they not transfer it to their personal account, they can’t transfer it to any other school,” he added. “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.”
Executive Director of Operations, Mustapha Iyal, said the pilot phase has commenced and disclosed that the fund had received close to 400,000 applications at the time of the briefing.
“It’s not a personal wallet, it’s not a mobile money wallet at all,” Iyal said, explaining that each token will be tied to a specific institution to preserve the purpose of the loan and strengthen accountability.
Officials did not announce a date for full implementation or name the institutions in the pilot phase.
NELFUND was established under the Students Loans (Access to Higher Education) Act, 2024, to provide eligible Nigerian students access to loans for institutional charges and upkeep allowances.