In 2024, the Nigerian Education Loan Fund (NELFUND), a flagship initiative under President Bola Tinubu’s administration, was launched with a noble promise: to provide financial relief to millions of Nigerian students pursuing higher education.
Designed to cover tuition fees, academic charges, and upkeep costs, the scheme aimed to democratise access to education and alleviate the financial burdens on families.
However, less than a year into its implementation, NELFUND has been embroiled in a storm of controversy, with allegations of fraud, unauthorised deductions, and financial mismanagement casting a shadow over its credibility.
Accusations of collusion between universities and banks, coupled with a high-stakes blame game, have sparked public outrage and prompted investigations by anti-corruption agencies.
The Genesis of the Crisis
The NELFUND student loan scheme, established under the Student Loans (Access to Higher Education) Act of 2024, was hailed as a lifeline for Nigerian students. By May 2024, the loan application portal opened, initially targeting students in federal tertiary institutions.
The scheme promised to disburse funds directly to institutions for tuition and to students’ verified bank accounts for upkeep allowances, with a reported ₦203.8 billion received by NELFUND as of March 19, 2024, from various sources, including the Federation Allocation Account Committee, the Economic and Financial Crimes Commission (EFCC), and the Tertiary Education Trust Fund (TETFund).
However, cracks began to surface as early as April 2024, when the National Orientation Agency (NOA) and NELFUND raised alarms about irregularities in the disbursement process.
Reports emerged that some universities and banks were allegedly withholding or delaying approved loan funds, forcing students to pay tuition out-of-pocket despite loan approvals.
The NOA’s Director-General, Lanre Issa-Onilu, accused certain institutions of colluding with banks to sabotage the scheme, prompting calls for anti-corruption agencies to intervene.
By May 2025, the controversy escalated with media reports alleging that 51 tertiary institutions had engaged in illegal deductions ranging from ₦3,500 to ₦30,000 from students’ institutional fees.
A staggering ₦71.2 billion of the ₦100 billion reportedly released by the federal government was said to be unaccounted for, with only ₦28.8 billion disbursed to students.
These revelations, amplified by a Guardian Newspaper investigation, triggered a swift response from the Independent Corrupt Practices and Other Related Offences Commission (ICPC), which launched a comprehensive probe into the scheme’s administration.
The ICPC’s Investigation and the ₦71.2 Billion Question
The ICPC’s probe, announced on May 1, 2025, sent shockwaves through the education sector. In a statement, ICPC spokesperson Demola Bakare revealed that preliminary findings had uncovered “significant gaps” in NELFUND’s financial records.
The commission reported that while NELFUND had received ₦203.8 billion, only ₦44.2 billion had been disbursed to 299 institutions, benefiting 293,178 students. The discrepancy between the ₦100 billion reportedly allocated and the ₦28.8 billion disbursed raised questions about the whereabouts of ₦71.2 billion.
The ICPC’s investigation extended to key stakeholders, including the Director-General of the Budget Office, the Accountant-General of the Federation, senior officials from the Central Bank of Nigeria, and NELFUND’s CEO and Executive Director. The commission also signaled its intent to probe beneficiary institutions and individual students to trace the flow of funds.
However, the ICPC’s initial statement sparked confusion when it appeared to confirm discrepancies in NELFUND’s administration.
On May 2, 2025, the commission issued a clarification, admitting that a typographical error, the omission of the word “NOT”, had created the erroneous impression that fraud had been established.
The revised statement emphasised that no evidence of diversion or discrepancies had been confirmed and that the investigation was still in its preliminary stages, focusing on recipient institutions and students.
NELFUND’s Defense: “No Funds Mismanaged”
NELFUND was quick to counter the allegations, dismissing claims of mismanagement as “entirely false, grossly irresponsible, and deeply damaging.”
In a statement on May 1, 2025, the fund’s Director of Strategic Communications, Oseyemi Oluwatuyi, argued that the ICPC’s comments had been taken out of context.
She emphasised that NELFUND’s operations were fully automated, with disbursements digitally tracked, time-stamped, and verifiable to eliminate human interference.
Oluwatuyi clarified that tuition fees were paid directly to verified institutions, while upkeep allowances were transferred to students’ bank accounts, leaving no room for misappropriation.
NELFUND also sought to distance itself from the ₦71.2 billion controversy, arguing that the figures cited in media reports were drawn from older education financing interventions predating its 2024 launch. The fund reiterated its commitment to transparency, noting that it had complied fully with the ICPC’s requests for documentation.
On X, NELFUND posted on May 1, 2025, “Setting the Record Straight…NELFUND Rejects False Claims, Stands on Transparency,” reinforcing its stance that no funds had been mismanaged or stolen.
READ ALSO: NELFUND Denies Misappropriation, Says No Student Loan Funds Missing
Universities Under Fire: Accusations and Rebuttals
The allegations of unauthorised deductions placed universities at the center of the storm. Reports indicated that some institutions had imposed additional fees or withheld loan disbursements, leaving students in financial limbo.
The National Association of Nigerian Students (NANS) accused certain universities of transferring loan funds into personal accounts, while the NOA claimed that institutions failed to notify students of disbursements or reflect payments in their financial records.
Specific universities have not been publicly named in the allegations, but the scale of the accusations, implicating 51 institutions, suggests a systemic issue.
Some institutions reportedly deducted between ₦20,000 and ₦40,000 from students’ loan disbursements, actions described as “fraudulent” by the Presidency.
The Senior Special Assistant to the President on Student Engagement, Sunday Asefon, condemned these practices, vowing that the EFCC and ICPC would pursue culpable institutions and officials.
In response, universities have largely remained silent or issued vague denials. The lack of specific rebuttals from individual institutions has fueled public skepticism, with many questioning why disbursed funds have not reached students.
On X, sentiments reflect frustration, with users like @the_beardedsina expressing confusion over conflicting narratives: “In the morning, there was news that ICPC allegedly said over 70 bn Naira was missing from NELFund. This evening NELFund has debunked that no funds were missing or stolen.”
The Blame Game and Public Outrage
The NELFUND debacle has devolved into a high-stakes blame game, with each party deflecting responsibility. The NOA and NELFUND initially pointed fingers at universities and banks, accusing them of undermining the scheme’s objectives.
Universities, in turn, have been criticised for their lack of transparency, while NELFUND has faced scrutiny for its oversight of the disbursement process. The ICPC’s initial misstatement further muddied the waters, amplifying public distrust.
Public reaction has been one of outrage and disappointment. Rights activist Deji Adeyanju described the alleged discrepancies as a “gross betrayal of public trust,” calling for the arrest and prosecution of those responsible. Student advocacy groups have demanded transparency dashboards and complaint channels to track loan statuses independently.
On social media, users have voiced concerns about the scheme’s integrity, with some questioning whether the funds were ever intended to reach students.
The Presidency has sought to distance itself from the scandal, emphasising President Tinubu’s commitment to inclusive education.
The Federal Ministry of Education, led by Minister Tunji Alausa, has launched its own investigation and summoned vice-chancellors and NELFUND’s Managing Director to a meeting scheduled for May 6, 2025.
The ministry also plans to introduce a compliance-tracking initiative and an Annual University Transparency Index to enhance accountability.
Broader Implications and the Path Forward
The NELFUND debacle exposes deep-rooted challenges in Nigeria’s education financing system.
The allegations of fraud and mismanagement underscore the need for robust oversight mechanisms to prevent exploitation. The involvement of anti-corruption agencies like the ICPC and EFCC signals a commitment to accountability, but the lack of concrete findings thus far raises questions about the investigation’s pace and scope.
For students, the stakes are high. Delays in loan disbursements and unauthorised deductions have left many struggling to afford education, undermining the scheme’s purpose.
The National Association of Nigerian Students has called for stricter monitoring, while the House of Representatives Committee on NELFUND has pledged to collaborate with the ICPC to prevent further malpractice.
The controversy also highlights the dangers of misinformation. The ICPC’s typographical error and conflicting media reports have fueled public confusion, as evidenced by posts on X. Moving forward, clear and consistent communication from all parties will be critical to restoring trust.
Conclusion
The NELFUND student loan scheme was envisioned as a transformative initiative to empower Nigeria’s youth through education.
Instead, it has become a lightning rod for controversy, with allegations of fraud, unauthorized deductions, and financial discrepancies threatening its legacy.
While NELFUND and the ICPC have denied confirmed wrongdoing, the ongoing investigations and public outcry underscore the urgency of addressing systemic flaws in the scheme’s administration.
As the ICPC extends its probe to institutions and students, and the Ministry of Education rolls out new transparency measures, the hope is that accountability will prevail.
For now, the NELFUND debacle serves as a cautionary tale of the challenges in implementing large-scale public programs in Nigeria, and a reminder that the dreams of millions of students hang in the balance.