NELFUND Student Loan Repayment Capped at 10% of Gross Income
Repayment of loans obtained from the Nigerian Education Loan Fund, NELFUND, is capped at 10 per cent of a beneficiary’s gross monthly income.
The provision is contained in the Students Loans (Access to Higher Education) Act, 2024.
The law established NELFUND as the Federal Government’s vehicle for providing loans for higher education, vocational training and skills acquisition.
Under the Act, beneficiaries are expected to begin repayment after completing their studies and securing employment.
However, monthly deductions cannot exceed 10 per cent of a beneficiary’s gross income until the loan and applicable charges are fully repaid.
The provision is designed to prevent graduates from facing excessive financial pressure while repaying their education loans.
When NELFUND repayment begins
The law also provides a period before NELFUND can begin enforcement against a beneficiary.
The Fund cannot initiate enforcement action until two years after the beneficiary completes the National Youth Service Corps, NYSC, programme or receives an exemption.
A beneficiary may also voluntarily begin repayment before completing the course of study.
The repayment amount is linked to income rather than a fixed monthly sum.
For example, a graduate earning N200,000 gross monthly income would have a maximum repayment obligation of N20,000.
A beneficiary earning N500,000 gross monthly income would have a maximum monthly repayment of N50,000.
This means graduates with higher incomes would repay more each month, while those earning less would make smaller payments.
Unemployed beneficiaries can seek extension
The Act also provides protection for beneficiaries who remain unemployed.
A beneficiary without employment or income may seek an extension from NELFUND.
The applicant must provide a sworn statement in the manner prescribed by the Fund.
The law also provides sanctions for false statements submitted to NELFUND.
A person convicted of making a false statement may face imprisonment for up to three years.
NELFUND has disbursed N303.9bn
The repayment framework comes as NELFUND’s student loan programme continues to expand.
The Fund disclosed that it had processed 1,635,676 applications as of July 3, 2026.
It also recorded about 850,000 unique beneficiaries.
NELFUND said it had disbursed N303.9 billion to beneficiaries.
Of the amount, N190 billion went towards institutional charges.
Another N113.8 billion was disbursed as upkeep support for eligible students.
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The distinction between applications and beneficiaries is important.
Some students have had more than one application processed.
The figure of about 850,000 therefore represents individual beneficiaries rather than the total number of applications.
Why loan repayment matters
NELFUND is expected to recover loans from beneficiaries and use the funds to support future applicants.
The Act empowers the Fund to recover outstanding loans through legal means.
It also requires NELFUND to maintain proper accounts and records.
Its accounts are to be audited annually by an independent firm.
The Fund must also publish its annual report within six months after the end of each financial year.
The growing number of beneficiaries means an effective repayment system will be important to the future of the scheme.
NELFUND will need to track beneficiaries after graduation and identify those who have secured employment.
It will also need an efficient system for collecting repayments and recycling recovered funds into new loans.
Employers’ role in NELFUND repayment
The law places certain responsibilities on employers of NELFUND beneficiaries.
A prospective employer is required to enquire from NELFUND about the student-loan status of a person being employed.
Where NELFUND confirms that the employee has an outstanding loan, the employer may be required to provide information needed for loan recovery.
The Act prescribes sanctions for employers who contravene the relevant provision.
Such sanctions include a fine of at least N2 million, imprisonment for at least one year, or both.
How to apply for NELFUND student loan
Applicants can apply for the NELFUND student loan through the Fund’s online portal.
Applicants should click Apply Now and complete the required verification and profile information.
The process includes verification of relevant identification and JAMB details.
Students may also be required to provide their institution and matriculation details.
After creating and verifying an account, applicants can complete their personal and banking information.
They can then proceed to request the student loan and select the relevant funding option.
Applicants should upload any documents requested by the portal before submitting the application.
NELFUND application process
Registration and verification
- Visit the NELFUND student loan portal and select Apply Now.
- Provide your National Identification Number, NIN, and JAMB registration details.
- Select your public tertiary institution.
- Enter your matriculation number and verify your date of birth.
- Provide your email address and create a secure password.
- Verify your account through the link sent to your email.
Complete your profile
After verification, log into the portal and complete your profile.
Provide your current phone number and residential address.
You will also need to provide your Bank Verification Number, BVN, and required bank account information.
Applicants should follow the current instructions displayed on the NELFUND portal because documentation and verification requirements may change.
Submit your loan request
Select Request for Student Loan after completing your profile.
Applicants seeking institutional charges can select the relevant option and provide the required information.
Students seeking upkeep support should also check the current eligibility requirements before submitting their request.
Upload any required documents, review the declaration and terms, then submit the application.
For beneficiaries, the 10 per cent repayment ceiling provides a statutory limit on monthly deductions from gross income.
For NELFUND, the long-term challenge will be recovering loans efficiently while continuing to provide funding for new applicants.
The success of that system could determine how sustainably the student-loan programme supports future generations of Nigerian students.
