NELFUND to Launch Token-Based Tuition Payments to Curb Overpayments, Boost Transparency

The Nigerian Education Loan Fund (NELFUND) is planning to launch a token-based tuition payment system that will allow students to pay their fees directly to their institutions through a secure digital process instead of the agency paying schools on their behalf.

The new system is designed to stop cases of double payment and improve transparency in the student loan scheme as the number of beneficiaries increases.

Akintunde Sawyerr, NELFUND managing director, revealed the plan during an interview on ARISE News, saying the upgrade followed lessons learnt during the first year of the scheme.

He said many students had already paid their tuition to meet registration and examination deadlines before NELFUND processed and released payments to their institutions, leading to duplicate payments in several cases.

To address the problem, NELFUND wants students to receive digital tuition tokens on their mobile phones, which they will use to make payments directly at their schools’ bursaries.

“We’re looking at a tokenised system where the student has the funds effectively as a token on their telephone, and when they go to the bursary, they can effectively push a button that makes the payment, and then they’re allowed to carry on with classes,” Sawyerr said.

He added that once the system becomes operational, the agency will no longer transfer tuition fees directly to tertiary institutions.

“Once we are able to successfully achieve that upgrade in the system, it will mean that we no longer pay the schools; the student pays the schools but through a token,” he added.

Sawyerr explained that NELFUND deliberately decided against paying tuition loans into students’ personal bank accounts because doing so could lead to funds being used for purposes other than education.

“We chose not to pay students directly for the loans because that would take us into an entirely new area where students get paid for the fees, and they can then make the decision as to whether they want to go to school or not,” he said.

He said the student loan scheme was created by the administration of President Bola Tinubu to ensure that qualified Nigerians are not denied tertiary education because they cannot afford tuition.

“The objective is to ensure that those who have the capacity to go to a tertiary institution are not hindered because they don’t have money,” he said.

While tuition payments remain tightly controlled, Sawyerr noted that students will continue to receive their upkeep allowances directly.

The planned reform comes as NELFUND investigates 34 tertiary institutions accused of failing to refund students whose tuition had already been paid before the agency also sent payments to the schools. The investigation involves anti-graft agencies, including the EFCC and ICPC.

According to Sawyerr, many affected students borrowed money from relatives and friends to meet school deadlines before their loan applications were approved, making refunds necessary.

He also said synchronising loan applications and disbursements with academic calendars should help reduce such cases.

“The fact that we’re now aligning our payment and application cycles to the academic cycle will ease these problems. I don’t think problems ever go away, there’ll be new ones, but we’ll deal with them as they come along,” he said.

NELFUND said the token-based tuition fee payment model is part of its plan to strengthen accountability and improve the efficiency of the student loan programme.

As of July 3, 2026, the agency had disbursed more than N303.91 billion to about 1.64 million beneficiaries across public universities, polytechnics, colleges of education and vocational institutions.

Between May and July 2026, NELFUND released an additional N21.7 billion, with upkeep allowances accounting for the larger share of the increase.

Under the scheme, beneficiaries are expected to begin repaying their loans two years after completing the National Youth Service Corps (NYSC).

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