A student loan is a loan that allows a student to pay for housing and board, personal living expenses, stationery, and other academic expenditures while attending a higher education school. A student in financial need can apply for the loan if they satisfy the qualifications for a student loan in Nigeria. Many needy students are unaware that it exists, and those who are aware are unable to obtain it because they do not understand how to apply for the loan.
In this essay, we will look at how to receive a student loan in Nigeria without a down payment. We will provide a brief history of Nigerian school loans, their requirements, how to apply for them, the loan amount, and payback conditions. We will also discuss additional lending sources and terms.
History of Education Loan
Many Nigerian parents consider education as a means of raising their children out of poverty. In 1972, the Nigerian Government formed “The Nigerian Students Loans Board.” This organization aimed to grant loans to qualified Nigerians to support undergraduate and graduate courses in Nigeria and abroad.
According to a jstor.org source, this Board disbursed N46 million between 1973 and 1991. Because debt recovery has been problematic, the government has replaced the Board with “Nigerian Education Bank.”
This new agency, among other things, provides educational consulting services and oversees loan disbursement for professional courses such as architecture, law, medicine, and accounting.
Check out: Loan Apps With Instant Approval And no Collateral
Education bank loan requirements in Nigeria
Conditions of Eligibility:
Nigerian students enrolled in an accredited program at a higher education institution recognized by the National Council for Higher Education must be the applicants.
Advertisement of the Available Loan
The Nigerian Students Loans Board will publish an official advertisement in a major national newspaper inviting qualified students to apply to the Board for loans or scholarships within a certain time frame.
How To Apply For a Student Loan in Nigeria
To obtain a student loan in Nigeria, follow these steps:
Determine how much you require
To obtain a student loan, you must first determine how much money you require, where you can obtain it, and gather the necessary documentation.
Find out the Required Documents
You must gather the following papers for a student loan in Nigeria; this is mostly for a loan from Nigeria Education Bank; for other lenders, continue reading the articles. They are as follows:
- Names, age, birth certificate, marital status, and sex
- Academic records – admission letter
- A form of identification, three recent passport photos, and a copy of fees from the Institution
- The Course of study, duration, start date, and end date.
- Bank account and depositing of N2,000 as a processing fee (for Nigeria Education bank loan)
- Submit the name of the banker of your Institution (which is usually Nigeria Education Bank.)
Please note that requirements will vary among different lenders
Examine the Terms and Conditions
- Determine the loan amount, purpose, lending conditions, and payback terms.
- Amount of the loan: It is between N24,000 and N32,000. Or any number significantly greater than this.
- Purpose: Living expenses, stationery, and other school-related costs
- Loan Duration: This changes according to the number of years each candidate has completed the Course.
- Repayment: Typically, two years after finishing your school.
The majority of these will be determined by the lender.
See also: 10 Budget Apps that can help you manage your spending in 2023
Contact a lender
Go to your preferred commercial bank. These banks are partners with the Nigerian Education Bank. Learn about the account opening criteria and other details required to obtain a student loan in Nigeria without collateral.
After that, register a bank account and deposit N2,000 as a processing fee for the student loan. That is if you seek a loan from the Nigerian Education Bank.
Submit your application for a Student Loan
- Go to your university’s Dean of Students Affairs, get a loan application form, and fill it out.
- Attach all essential papers and complete all applicable payments.
- Submit your application to the Dean’s Office’s Student Loan Taskforce.
Wait for your student loan application to be processed and approved.
Wait for the Nigeria Students Loans Board to respond. During the processing period:
- If you did not correctly complete the application form, you will receive an email, SMS, or phone call from the Loans Board’s Operations Unit to fix it.
- The names of successful candidates will be published in a national publication by the Ministry of Education. Your name will also appear on the Ministry’s website, and you will get a letter notifying you of the sum that has been assigned to you.
- You will be given a student loan identity number and ID cards, and the loan profits will be submitted to the Nigerian education bank for disbursement to your bank.
The methods outlined above are for the Nigeria Education Bank loan. Other lenders are listed below.
Other places where you may obtain a student loan with no collateral
You can obtain a loan through the creative sector initiative as well as through local banks that offer educational loans. A list of different borrowing possibilities is provided below.
Creative Sector Loan
Another option for obtaining a student loan in Nigeria without collateral is to apply for a creative sector loan. Through a Central Bank of Nigeria initiative, the Federal Government of Nigeria has launched the Creative Sector Loan.
The loan’s goal is to increase capacity and create jobs for individuals and firms that are already experts in specified sectors.
Benefits: The loan offers low-cost and low-interest capital for business and education, with a flexible structure and payback periods, as well as financial counseling.
Eligibility: To be eligible for the Creative Industry loan, your company must satisfy the following criteria:
- Present a comprehensive business proposal to the bank of your choice
- Spotless Credit Bureau Report with no unpaid loans to any Commercial bank
- Acceptable Credit risk management system(CRMS) report of owners, sponsors, and the director’s application process.
- Belong to the creative industry (fashion, music, Movie Production, Movie Distribution, and information technology).
- Have a business duly registered with the Corporate Affairs Commission
Check out: Best Ways to Save Money in Nigeria Easily
Documents required for all CIF Loans
- Accepted Offer Letter
- Business Plan
- Board Resolution (if corporate)
- The Creative Sector Loan for Software Engineering Student
See the requirements and steps to get student loans in Nigeria without collateral.
Creative Industry student loan terms and Conditions
The terms and conditions for the Software Engineering student loan are as follows.
- Interest rate: The loan has a maximum interest rate of 9% per year, including all fees.
- Loan classification:100% Central Bank of Nigeria financing for a term loan
- Moratorium: A nine-month moratorium on repayment from the date of issuance.
- After the nine-month moratorium expires, repayment is made every month.
- Period of repayment: The student loan can be repaid over a maximum of three years.
- Minimum Equity Contribution (0%), University Degree, NYSC Certificate, Credible Guarantor, and Personal Guarantee are required as collateral.
Financial institutions that Offer Education Loan
The Federal Government of Nigeria has found it difficult to fund education. Going to a bank that offers an education loan is therefore a way for obtaining a student loan in Nigeria without collateral.
Banks provide loans to students to help them pay for their education both locally and overseas. Banks often provide education loans with varied terms and conditions.
For example, Standard Chartered Bank offers a Smart Credit Educational Loan that allows students to borrow up to 10 million and return it over six years.
Stanbic IBTC Bank PLC offers an educational package that offers an international money transfer option for paying school fees and allowances in other countries.
Zenith Bank and Access Bank provide educational loans and personal advances.
For example, Zenith Bank Plc offers an educational loan to cover tuition costs. It is a conditional short-term loan.
Students can get loans from GTBank, Access, and other financial institutions.
Related article:
- 10 Best Lucrative Business Ideas With Small Capital In Nigeria
-
Procedure and Requirements for NIRSAL Household Loan Application
