Loan Scheme Faces Integrity Test as FG Accuses Universities, Banks of Collusion

The integrity of Nigeria’s student loan disbursement system is under scrutiny, as the Federal Government has accused some tertiary institutions and banks of colluding to frustrate the process for personal gain.

Lanre Issa-Onilu, Director-General of the National Orientation Agency (NOA), made the allegations public following a briefing with Akintunde Sawyerr, Managing Director of the Nigerian Education Loan Fund (NELFund). The meeting came in the wake of widespread student complaints about unexplained delays in receiving approved loans.

According to Issa-Onilu, the government has credible evidence that some institutions are actively concealing disbursement records and failing to cooperate with NELFund, thereby sabotaging the system’s efficiency and credibility. “There is a systemic effort by certain universities and banks to benefit at the expense of vulnerable students,” he said.

Sawyerr supported the claims, adding that in several reported cases, institutions had received loan payments but kept students unaware. “This lack of disclosure has triggered confusion and mistrust, both of which undermine the national objectives of the loan scheme,” he noted.

NELFund says it is exploring legal options and is working with regulatory bodies to hold accountable those involved. Officials emphasize that reforming the disbursement process is now a top priority to prevent future exploitation and protect student rights.