NELFUND Introduces Token System to Stop Double Payment of School Fees

The Nigerian Education Loan Fund (NELFUND) has begun piloting a new token-based payment system designed to prevent students from paying their school fees twice and reduce complications associated with refunds.

The Managing Director of NELFUND, Akintunde Sawyerr, disclosed this on Wednesday, October 28, 2026, during a press briefing, explaining that the proposed arrangement would give beneficiaries greater control over the payment of their approved institutional fees.

Under the new system, students will be able to authorise payments directly to their respective institutions through a digital token linked to their schools, rather than having to rely solely on notifications after payments have been made.

The development comes as NELFUND continues to process applications under the Federal Government’s student loan scheme, with the agency reporting nearly 400,000 applications at the time of the briefing.

Sawyerr said the initiative was introduced to address situations in which students unknowingly paid fees that NELFUND had already settled on their behalf, resulting in duplicate payments and subsequent demands for refunds.

He explained that delays in communicating completed transactions had created confusion among beneficiaries, particularly those facing registration deadlines and other academic requirements.

According to him, a student might pay school fees independently because they had not been informed that NELFUND had already transferred the approved amount to their institution.

The student could subsequently discover that the fund had settled the same bill, leaving them to seek a refund from the institution.

Sawyerr described such incidents as genuine mistakes arising from communication gaps rather than deliberate wrongdoing.

The NELFUND chief executive said the new arrangement was intended to eliminate the problem by allowing students to initiate payments themselves once their approved funds were ready.

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

How NELFUND’s New Token Payment System Will Work

Under the proposed arrangement, beneficiaries will receive notifications when their approved school fees are ready for payment. They will then be able to use an application on their mobile phones to authorise the transaction.

Once authorised, the funds will be transferred directly to the designated institution, with the token restricted to the school for which the payment was approved.

NELFUND said the arrangement would prevent students from transferring the approved tuition funds into their personal bank accounts or redirecting the money to another institution.

Sawyerr stressed that the system was not designed to hand cash directly to beneficiaries but to give them control over initiating payments while ensuring that the funds remained dedicated to their intended purpose.

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

To illustrate how the arrangement would operate, he explained that a student with an approved institutional payment of ₦200,000 would only be able to authorise payment to the designated school’s account.

The money would not move until the student initiated the transaction, according to the explanation provided during the briefing.

NELFUND’s Executive Director, Mustapha Iyal, also clarified that the token should not be confused with a personal wallet or a mobile money account.

He explained that the token would be linked to a specific institution and would serve as a payment authorisation mechanism rather than an account from which beneficiaries could freely withdraw or transfer funds.

The restriction is intended to reduce the risk of misdirected payments while improving accountability in the administration of the student loan scheme.

NELFUND Reports Nearly 400,000 Applications

Iyal confirmed that the pilot phase of the tokenised payment system had commenced, disclosing that the fund had received close to 400,000 applications at the time of the briefing.

However, the figure represents applications received and should not be interpreted as the number of students whose payments have already been processed through the new system.

The officials did not announce a specific date for the full implementation of the token-based arrangement.

The pilot is expected to help the fund assess how the new payment process can improve coordination among beneficiaries, tertiary institutions and the agency.

For students, the effectiveness of the system will depend on timely notifications, accurate records of approved fees and efficient confirmation of payments by their institutions.

These measures will be particularly important for students who must meet school-fee deadlines to complete registration or participate in academic activities.

What the New System Means for Students

The proposed payment arrangement could reduce the uncertainty faced by beneficiaries who are unsure whether NELFUND has paid their school fees.

By allowing students to authorise transactions after receiving notification that their approved funds are ready, the system is intended to reduce the likelihood of duplicate payments and the administrative burden of recovering money from institutions.

It could also strengthen accountability by ensuring that approved tuition funds are used only for the institution and purpose for which they were authorised.

However, students should continue to confirm their payment status through the appropriate NELFUND and institutional channels and follow their schools’ official payment procedures while the pilot is being implemented.

The introduction of the token system does not mean students will receive approved tuition funds as cash in their personal bank accounts.

It is also important to distinguish institutional charges from upkeep allowances. The reported change concerns payments for school fees, while approved upkeep allowances remain subject to the existing disbursement arrangement.

NELFUND administers the Federal Government’s student loan scheme established under the Students Loans (Access to Higher Education) Act, 2024. The programme is intended to help eligible Nigerian students meet the financial demands of tertiary education through interest-free loans for approved educational expenses.

The success of the new system will depend on how effectively NELFUND and participating institutions communicate payment information, verify transactions and resolve outstanding issues as the pilot progresses.

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