BREAKING: NELFUND Introduces Token System to Prevent Double School Fee Payments

The Nigerian Education Loan Fund(NELFUND) has begun piloting a token-based payment system aimed at preventing students from paying their school fees twice and reducing complications associated with refunds.

NELFUND Managing Director, Akintunde Sawyerr, disclosed this on Wednesday during a press briefing, saying the system would allow beneficiaries to authorise payments directly to their respective institutions using tokens linked to their schools.

The initiative is designed to address cases in which students pay their fees independently because they are unaware that NELFUND has already paid their institutions on their behalf.

Sawyerr explained that delays in communicating completed payments to beneficiaries had sometimes resulted in duplicate payments, forcing students to seek refunds from their institutions.

He illustrated the problem with a situation in which NELFUND pays a student’s fees on Monday, but the student, unaware of the transaction, makes another payment on Wednesday before learning of the earlier disbursement on Friday.

“It was a genuine error, no suspicion, no accusation, just genuine error,” he said.

According to Sawyerr, the token-based system would give students control over initiating payments while ensuring that approved loan funds are transferred only to the designated institutions.

Under the proposed arrangement, beneficiaries would receive notifications when their approved fees were ready for payment and could authorise the transactions through an application on their phones.

“We want to eliminate that need for refunds. So we’re placing the power of payment in the hands of the students,” he said.

Sawyerr stressed that the arrangement would not involve transferring institutional loan funds into students’ personal bank accounts.

“We’re not giving the students money, but we’re giving them power,” he said.

He added that the system would prevent beneficiaries from redirecting approved payments to personal accounts or transferring the funds to other institutions.

For instance, a student with an approved school fee payment of ₦200,000 would only be able to authorise payment to the institution designated for the transaction.

“If they don’t push the button, the money doesn’t go anywhere. It will never be able to be transferred to the personal account of the student or anybody else,” Sawyerr said.

NELFUND on token linkage

NELFUND Executive Director, Mustapha Iyal, also clarified that the token would be linked to a specific institution and would not function as a personal or mobile money wallet.

“It’s not a personal wallet, it’s not a mobile money wallet at all,” Iyal said.

He explained that the institution-linked mechanism would ensure that funds approved for one school could not be redirected to another institution or a beneficiary’s personal account.

Iyal confirmed that the system was already in its pilot phase, disclosing that the fund had received close to 400,000 applications at the time of the briefing.

“As I speak to you, we already have close to 400,000 applications,” he said.

However, the officials did not specify when the token-based payment system would be fully implemented or indicate how many of the applications received had been processed through 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 Nigerian students with loans to cover approved institutional charges and, where applicable, upkeep expenses.

The proposed token system focuses on institutional fee payments, while upkeep allowances remain a separate component of the student loan scheme.

The initiative is expected to improve payment coordination among NELFUND, students and tertiary institutions by reducing cases in which beneficiaries pay fees already covered by the fund.

Its effectiveness will depend on how efficiently students and institutions receive payment notifications, authorise transactions and confirm that fees have been settled, particularly where registration deadlines apply.