The Nigerian Education Loan Fund has commenced a pilot scheme for a new token-based payment system designed to prevent students from paying their school fees twice and reduce complications associated with refunds.
NELFUND Managing Director, Akintunde Sawyerr, disclosed this on Wednesday during a press briefing, explaining that the system would enable beneficiaries to authorise payments directly to their institutions using tokens linked to their respective schools.
Sawyerr said the initiative was introduced after the fund identified cases in which students paid their fees independently without knowing that NELFUND had already transferred the money to their institutions.
He explained that delays in communicating completed transactions to beneficiaries sometimes resulted in duplicate payments, forcing students and institutions to navigate refund procedures.
According to him, a student might pay fees to meet a school’s deadline, unaware that NELFUND had already settled the bill. The student could subsequently discover the earlier payment after making a second transaction.
Sawyerr described such cases as genuine mistakes rather than deliberate attempts to obtain duplicate payments, adding that the new arrangement was intended to eliminate the problem by giving students control over when approved payments are initiated.
Under the proposed system, beneficiaries will receive notifications when their approved school fees are ready for payment and can authorise the transactions through their mobile devices. The funds will then be transferred directly to the designated institution rather than the student’s personal bank account.
“We’re not giving the students money, but we’re giving them power,” Sawyerr said, stressing that the arrangement would allow students to initiate payments without giving them unrestricted access to the loan funds.
He added that the system would prevent beneficiaries from redirecting approved payments to personal accounts or other institutions. For example, a student with an approved payment of N200,000 would only be able to authorise the transfer to the institution specified in the transaction.
NELFUND Executive Director, Mustapha Iyal, explained that each token would be linked to a particular institution and would not function as a personal or mobile money wallet. He said the restriction was designed to ensure that institutional payments reached their intended destinations.
Iyal confirmed that the pilot had commenced, with nearly 400,000 applications received by the fund at the time of the briefing. However, the officials did not provide a specific date for the system’s full implementation or establish that all the applications had been processed under the pilot.
NELFUND administers the Federal Government’s student loan scheme established under the Students Loans (Access to Higher Education) Act, 2024. The programme provides eligible students with loans to cover approved institutional charges and, where applicable, upkeep expenses. Under the existing arrangement, tuition and other approved institutional fees are paid directly to schools, while upkeep allowances are transferred separately to beneficiaries’ bank accounts.
Source: PUNCH
