A state of emergency! Without student loans, Nigeria has no future

Amina sat on the edge of her bed, staring at the acceptance letter from one of Nigeria’s top universities. It was everything she had worked for, everything her parents had sacrificed for. Yet, instead of excitement, Amina felt a heavy knot of dread in her stomach. How could she tell them that their shared dream was slipping away? The tuition was more than her father made in a year.

Amina, whose parents have done everything they can to give her a shot at a better life. They’ve sold off land, taken up extra jobs, and borrowed from relatives. But now, as Amina’s dreams hang in the balance, there’s nothing left to sell, no one left to ask. The university that accepted her is now a distant dream, fading from her grasp.

This isn’t just Amina’s story. It’s the story of Nigeria’s future slipping away, one student at a time.

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Nigeria’s future is at stake

Education is the cornerstone of any nation’s development, yet the cost of acquiring it has become increasingly prohibitive for many Nigerian families. Sadly, if the current trend continues, Nigeria could face a leadership crisis within the next decade — one in which those at the helm lack the necessary skills, knowledge, and vision to steer the country towards progress.

The harsh reality is that Nigeria’s economy fails to support its educational institutions. Federal universities, once seen as the affordable path to higher learning, are now struggling to maintain their standards due to inadequate funding. The situation worsens because many potential students cannot afford the relatively low tuition fees, creating a vicious cycle of underfunded schools and undereducated citizens.

As universities attempt to cope by raising fees, they unintentionally shut out a large segment of the population. Parents, already burdened by economic hardships, are unable to cover the increasing costs. This leaves students with few options: abandon their educational goals or seek alternative, often substandard, forms of education.

Interestingly, the federal government seems to agree with the prediction of a potential doom. So, on June 12, 2023, President Bola Ahmed Tinubu signed the Student Loan Bill into law, and on March 14, 2024, he proposed changes to the Student Loans (Access to Higher Education) (Repeal and Re-Enactment) Bill 2024, all in a bid to make education more accessible for Nigerians. 

Read more: All you need to know about the new student loan law

The role of credit in education

Student loans are the bridge between potential and success in many parts of the world. They enable students to pursue higher education regardless of their financial background, ensuring that talent, not wealth, determines who gets to sit in the classroom. For Nigeria, where the gap between the rich and poor is stark, student loans are the key to ensuring the quality of the nation’s citizens doesn’t decline.

Let’s take a closer look at the impact of student loans globally. In countries like the United Kingdom, Australia, and Canada, student loans have been instrumental in expanding access to higher education. In the UK, the introduction of income-contingent loans in the early 1990s led to a significant increase in university enrollment, particularly among students from lower-income backgrounds. This model allows students to repay their loans based on their income after graduation, ensuring that education is not a burden but an investment in their future.

Imagine if Nigeria could replicate this success with her recent student loan program. It would open the doors of universities to thousands of students and create a more skilled and competitive workforce. But the benefits go beyond individual success. When more students have access to education, the entire country benefits.

This is evident in the global recognition of education as a catalyst for economic growth. Bloomberg Philanthropies’ recent $600 million gift to historically Black medical schools in the United States highlights the important link between education and community well-being. Their investment will help more Black students become doctors, which will benefit not just the students but also the communities they will serve.

It’s no coincidence that some of the world’s most prosperous nations also have some of the highest rates of tertiary education. The World Bank has consistently highlighted the link between education and economic development, noting that every additional year of schooling can increase a person’s earnings by about 10% and can lead to a significant increase in GDP.

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Irorun, powered by Lendsqr, is expanding credit to students

Over half a decade of experience in the credit ecosystem, we’ve observed a common trend with educational loans: while most lenders focus on covering tuition, they often overlook other essential expenses that students face. Items like lab equipment, textbooks, and handouts are frequently neglected. 

This is where a Lendsqr-powered digital lender, Irorun, comes in. Student Credit by Irorun is an initiative specifically designed to address these overlooked yet essential needs. Their loans offer quick and accessible short-term financial relief. Ensuring that students like Amina can promptly purchase necessary items, such as a textbook mandated by a lecturer, without missing important classes due to delays in receiving funds from home.

Learn more: Student Credit: Helping Nigerian students take care of bills other than tuition fees

Nigeria’s future hangs in the balance

The government’s introduction of student loans is a step in the right direction, but it is not enough. Private sector involvement, as exemplified by Irorun, is equally important. By providing supplementary loans for essential educational expenses, these lenders complement the government’s efforts and create a more holistic support system for students.

Ultimately, this isn’t just about loans. It’s about giving every Nigerian student the chance to build a better future for themselves, their families, and the country. We cannot afford to let these dreams fade. Nigeria’s future depends on it.