In a bid for an inclusive education for all, in particular at the tertiary level, the Nigerian government heralds the Student Loan Act 2023. With a widespread consensus that education represents a critical component in the human capital development process, this initiative is a welcome development. However, advancement in the digital landscape is reshaping the educational space, which calls for a synergy of purpose for the successful delivery of mandates in this sector.

Productivity and economic prosperity of any nation are in tune with its level of technological development vis-à-vis the inherent innovation capability of its citizens, who, of course, reside across all tiers of educational level. However, this pathway to the supposed delivery has been hampered by poor funding, which is essential for equitable enrolment and learning in academic institutions. As a result, the new Student Loan Act is a positive step forward. The Student Loan (Access to Higher Education) Act, 2023, promises easy access to higher education for indigent Nigerians through interest-free loans from the Nigerian Education Loan Fund. A promise waiting for fulfilment in the minds of our tertiary students.

The Key Highlights from the Act

The Nigeria Education Bank Fund promises inclusive access to education at any public institution of higher learning in Nigeria with an equal right to access to qualified students without any discrimination arising from gender, religion, tribe, position, or disability of any kind. This minimizes the cost of tertiary education as the financial assistance will increase the enrolment of indigent students constrained by funds to pursue their higher education. Critical to the application procedure are certain terms and conditions inherent in a loan portfolio.

The eligibility criteria are that the applicant’s income or family income must be less than N500,000 per annum, while the guarantor system to access the funds includes civil servants of at least level 12 in the service, experienced lawyers, judicial officers, or justices of peace. Although inclusive literacy and advocacy with financial advice on educational matters for stakeholders (institutions of higher education, parents, and educational investors) are stated, a common platform to initiate this remains a question. The disbursement window period of within 30 days’ dictates a timely use of funds; provision for accountability in the terms of appropriation of applicants rules for disqualification (exam malpractice, fraud, criminal convictions, drug offenses, and the like) is established.

The student loan scheme offers proper monitoring of the academic records of grantees of the loans to obtain information on their year of graduation, national service, and employment and to ensure that grantees of the loans commence repayment of the loans as soon as they are due. The informed repayment process starts two years after the completion of the National Youth Service Corps program with a direct deduction of 10% of
the beneficiaries’ salary at source by the employer and credited to the Fund. Provisional defaulters are liable on conviction to a fine of N500,000, imprisonment for a term of two years, or both.

Appropriating the Act 2023 for long-term, sustainable delivery

Key aspect of this game-changing policy on higher education will increase the enrolment rate and foster inclusive learning. This provision encourages more individuals to pursue higher education, leading to an increase in the number of educated professionals across fields of study. Increased literacy in the nation through the tertiary educational system will also drive human capital development geared towards social and economic growth. Improved skilled professionals will deliver impact initiatives to drive sustainable economic growth and, subsequently, increase returns on quality education. The scheme promotes diversity and inclusivity within educational institutions, fostering a vibrant and enriched learning environment through sustainable access to funding.

However, a number of critical questions come to mind from the New Student Loan Act. Firstly, is there a chance of being gainfully employed afterwards for repayment purposes, and is there a specific limit to years of loan taking, even with students having extra years of study due to uncertainties? In another way, is the student loan fund a means to an end or an end in itself in the education ecosystem? What role will digital technology play in the application process for seamless operation within the fund management space? Although the disbursement process is underway, answers to these questions on the New Student Loan Act might be tailored into the amendment process for long-term delivery. Meanwhile, as a way of thinking, considering the high unemployment rate in the country, are there any prospects for innovation and entrepreneurship to scale startups and spinouts in tertiary institutions towards meeting loan repayment periods?

I suggest revitalization of the educational system for long-term human capital development should focus on innovation-centered interventions. A cursory look at digital advancement shows that technology and innovation play a pivotal role in transforming the educational landscape. For instance, support for edTech initiatives presents innovative digital tools and platforms, enhancing teaching methods and enriching the out-of-classroom learning experience.

This support can also incorporate interactive multimedia, robotics, and artificial intelligence (AI) into the educational curriculum, fostering engagement, critical thinking, and creativity among students. Investment in science, technology, engineering, and mathematics (STEM) has enormous opportunities and closely connects all fields of study across all tiers of education (primary, secondary, and tertiary). Aside from this fact, the addition of another acronym, I-innovation, (STEMI) thus suggests the strategic position of innovation as a propelling force towards an inclusive educational sector. The perception should complement the ultimate goals of the new Student Loan Act.

In conclusion, the Student Loan Act of 2023 presents a catalyst for an inclusive tertiary education ecosystem. There is a need to factor in technological and innovation enhancement strategies needed for sustained growth, which are critical to the loan scheme’s long-term viability. Appropriating the identified gaps will enable students from all backgrounds to leverage technology for research, collaboration, and skill development, bridging the digital divide and promoting the human capital and economic development that the educational sector upholds.

Good People, join me to commend this gentleman: Folashodun Shonubi, acting governor of Nigeria’s central bank. He impressed me today. Yes, since 2016 when they froze the publication of the Central Bank of Nigeria financial statements, I have written and challenged the government to obey the CBN Act: publish those documents for We The People. Today,  the documents have been published, and Shonubi is bringing Nigeria to the old order, at least in one area.

Read this: “The Group entered into a securities lending agreement with Goldman Sachs and J. P. Morgan and as part of the agreement, the Group pledged its holdings on foreign securities in return for cash. The cash received from Goldman Sachs is N0.23tn ($500m), 2021: N0.22tn ($500m), and JP Morgan N3.23tn ($7bn), 2021: N3.05tn ($7bn) is recognised in other foreign securities.”

So, when they told you that we had no money to pay doctors, nurses, lecturers, etc, even as they raked $billions in debts from American banks, it was all vapour lies. Without going political: Buhari took Nigeria backward by miles. He just held the “President” as a title!

That a general would allow that kind of rascality was simply unfortunate. In my village of Ovim, we have many military  generals, and we respect these men because even in their Isi-agu native dresses, you know they’re men of steel. What did they do with this money is the question we need to ask Buhari and his government because nothing was largely achieved?

And you know the unfortunate? More revelations are coming… Shonubi, go ahead and publish more. Of course, we also need the books to be audited.

Comment on Feed

Comment from user: I do appreciate your various posts and regular contributions. On the last one regarding the CBN’s books and loans, aren’t we missing part of the equation? You’re saying that the debt the CBN took was “rascality”. Wouldn’t it depend on whether the loans were taken for valid reasons? Were the funds used to grant loans for capex projects (in which case they’re not necessarily bad IF these projects are executed) OR were they squandered for subsidy and landed in the pocket of the few (which would be mayhem like you suggest). I think it’d be fair to add this point to your argument to drive the reasoning even further !

My Response: They were not disclosed until now. That is the rascality. It was hidden from Nigerians. This is not the sovereign debt.

Comment 1R: Ah OK. The fact they weren’t disclosed. Agreed. CBN were cowboys for sure. I really wonder how we’re going to get out of the mess we’re in. Subsidies destroy value as we’re totally incapable of managing properly. Lack therefore is the naira going into a tailspin.

My Response: I agree with you. But note that the subsidy is not really that bad. What is bad is the corruption in subsidy.

For years, including just last week, I have been demanding that the Central Bank of Nigeria (CBN) opens its books for the public to see what we have there. Amazingly, they have done that, after seven years,  and there are many bad things there: “Also, the CBN owes JP Morgan and Goldman Sachs a combined sum of $7.5bn as of the financial year ended December 2022. Included as part of its liabilities is another $6.3bn owned in foreign currency forwards.”

The Central Bank of Nigeria has released the Consolidated Financial Statements for the last seven years, making it the first time since 2015 that the apex bank will be making its book available for public scrutiny.

The Consolidated Financial Statements, which were released by the CBN, are for 2016, 2017, 2018, 2019, 2020, 2021 and 2022 financial periods.

The CBN declared a profit after tax of N103.8bn in 2022, up from N75.13bn reported a year earlier.

Also, the CBN owes JP Morgan and Goldman Sachs a combined sum of $7.5bn as of the financial year ended December 2022.

Included as part of its liabilities is another $6.3bn owned in foreign currency forwards.

The apex bank, however, stated it owes Goldman Sachs $500 million and JP Morgan $7 billion in what it classified as securities lending.

The 2022 financial statement read, “The Group entered into a securities lending agreement with Goldman Sachs and J. P. Morgan and as part of the agreement, the Group pledged its holdings on foreign securities in return for cash. The cash received from Goldman Sachs is N0.23tn ($500m), 2021: N0.22tn ($500m), and JP Morgan N3.23tn ($7bn), 2021: N3.05tn ($7bn) is recognised in other foreign securities.”

Securities lending forms part of the CBN’s total external reserves of about N14.3tn or $29bn using the official exchange rate of N494/$1 as of 2022.

However, the apex bank also owes another N3.15tn ($6.3bn) in foreign currency forward which are forex obligations it needs to make to foreign investors.

The financial statements uploaded on the CBN website is an indication that the apex bank, under the leadership of acting Governor Folashodun Shonubi, is ready to open its book to public scrutiny.

Comment on Feed

Comment 1: As Buhari became president, the CBN stopped publishing its report. What we witnessed in the past 8 years was a unique combination of ineptitude and impunity, it’s both unbelievable and unbeatable.

We are yet to know the true debt we are owing and the people we are owing. Everything that could go wrong went wrong, and up till now many are still in denial as to whether Nigeria is progressing or regressing. NNPC did its own magic.

You cannot wake up people who are pretending to be asleep.

Comment 2: It’s truly eye-opening to see the Central Bank of Nigeria’s finances being made public after seven long years. The startling revelation that the Central Bank of Nigeria owes JP Morgan and Goldman Sachs a whopping $7.5 billion raises important questions about financial management.

Let’s hope this is a game-changer for Nigeria’s accountability and economic progress.

The financial kinetics and mathematics continue.

But my simple questions include: is this figure complete? Or we should still be expectant? Why is it taking 7 years to show what is in there? Are they mutilating the data like the election results?