Managing Director of NELFUND Akintunde Sawyerr, speaking during an interview on Thursday at Igbobi College in Yaba, Lagos, clarified the operational details of the planned tokenisation for students, parents, and the agency. The Nigerian Education Loan Fund (NELFUND) recently announced the pilot tokenised payment system to prevent students from paying their tuition fees twice and to eliminate refund complications, with nearly 400,000 applications already received under the ongoing process.
“By introducing the token payment system, we have put control of the payment, through an app or button, directly into the hands of the students. That is what tokenisation is about: to prevent double payments to schools, either by parents or by NELFUND,” Sawyerr said.
Before the revision, NELFUND transferred tuition fees directly into the bank accounts of tertiary institutions, while living allowances were disbursed directly to the students. However, the new tokenisation framework focuses specifically on institutional fee payments.
Direct student control over fee disbursement
“Naturally, once we started paying, some students had already paid their fees because we started midway through the session. What that meant was that once we paid the school on behalf of a student who had already settled their account, the school received a double payment,” Sawyerr explained.
He noted that bursary staff sometimes told students who had not paid their fees that their funds had not yet arrived from NELFUND, putting them in a difficult position when facing administrative deadlines such as examinations.
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“In such scenarios, some students were either forced to pay on top of what we paid or to withdraw from certain school activities. We decided to end that situation by using a token system where we send electronic money to an app on the student’s phone,” Sawyerr emphasised.
Streamlining institutional payments and eliminating refunds
Under the proposed tokenisation framework, students will use a mobile app to authorise payments from their approved loan funds directly to their institutions, rather than receiving the tuition money in their personal bank accounts. Once a student receives the token via the mobile app, they can initiate the transfer at their discretion.
“They press the pay button, and the funds transfer to their specific school only—the institution where they are admitted. They cannot use that payment for any other purpose,” Sawyerr noted.
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The mechanism eliminates situations where NELFUND disbursed fees to an institution on a Monday, but a student—unaware of the transaction—paid the same fees independently by Wednesday, only learning of the initial transfer later in the week.
“We want to remove instances where students are forced to seek refunds from their various institutions by placing the power of payment in the hands of the students,” Sawyerr said. NELFUND confirmed that each token is encrypted and linked strictly to the designated institution, ensuring funds cannot be redirected into secondary accounts.
Charles Ogwo is a proactive journalist, driving education, and business innovations for over 10 years. He leads initiatives leveraging tech to enhance storytelling and build topnotch performing team. Charles is passionate about harnessing technology to inform, engage and empower communities.
