Student Loan App in Nigeria Approved By CBN

Happiness MusaLast Updated: May 29, 2024

Student Loan App in Nigeria Approved By CBN: As a Nigerian student, you know the financial burden of higher education all too well. With tuition fees rising every year, taking out student loans has become a necessity for many. The good news is that the Central Bank of Nigeria (CBN) has approved several fintech apps solely dedicated to offering student loans.

These loan apps aim to increase access to financing for university and polytechnic students across Nigeria. With flexible repayment options, quick disbursement times, and no collateral requirements, they provide a lifeline for students struggling to pay their fees. In this article, we will explore the top CBN-approved student loan apps in Nigeria as of May 2024. You will learn how these apps work, their loan terms, eligibility criteria, and more. The information provided will help you make an informed choice when taking out a student loan.

Table of Contents

Overview of Student Loan Apps in Nigeria

Government-Owned Student Loan Apps

The Central Bank of Nigeria (CBN) currently approves three government-owned student loan mobile applications:

CSS Student Loans: Offers up to ₦2 million for undergraduate and postgraduate studies at an interest rate of 5% per annum. The loan is payable within 5-10 years after completion of studies.
National Youth Service Corps (NYSC) Student Loans: Provides loans of up to ₦3 million to youth corps members enrolled in postgraduate programs with up to 3 years repayment period at an interest rate of 4.5% per annum.
National Open University of Nigeria (NOUN) Students Loans: Grants loans of up to ₦2.5 million to students of the National Open University of Nigeria at an interest rate of 3.5% per annum with up to 5 years repayment period.

Privately-Owned Student Loan Apps

There are also privately-owned student loan mobile apps approved by the CBN, including:

EdFin Microfinance Bank Student Loans: Offers loans of up to ₦5 million to students in Nigerian tertiary institutions at an interest rate of 15-20% per annum with 6-48 months repayment period.
LAPO Microfinance Bank Student Loans: Provides loans of up to ₦2 million for undergraduate and postgraduate studies at an interest rate of 1.5% per month with 6-24 months repayment period.

With several student loan options now available via mobile applications, financing tertiary education in Nigeria has become more accessible. Students and families can compare interest rates, eligibility criteria, loan amounts and repayment terms to choose student loan apps that best suit their needs. By utilizing these loan programs, students across all socioeconomic backgrounds have greater opportunities to earn university degrees and pursue their career goals.

Top Student Loan Apps Approved by CBN

Here are the top 10 student loan apps in Nigeria approved by the CBN

Branch: Started in Kenya in 2015, before entering Nigeria as a lending app in 2017. Number of Downloads: 10Million+, Rating: 4.5
FairMoney: Launched in 2017. Number of Downloads: 10Million+, Rating: 4.2
Okash: Started operations in Nigeria in 2018. Number of Downloads: 5Million+, Rating: 4.3
Kuda: Started in 2019. Number of Downloads: 5M+, Rating: 4.3
Palm credit loan app: Launched on June 26, 2018. Number of Downloads: 5Million+, Rating: 4.2
Quickcheck: Started in 2017. Number of Downloads: 1Million+, Rating: 4.5
Carbon: Started in 2012. Number of Downloads: 1Million+, Rating: 4.3
Renmoney: Started in 2012. Number of Downloads: 1Million+, Rating: 4.1
Umba mobile app: Launched in Nigeria in January 2021. Number of Downloads: 1Million+, Rating: 3.6
Aella Credit: Started in 2015. Number of Downloads: 1Million+, Rating: 3.2

How to Apply for Student Loans on These Apps

To apply for student loans through the Central Bank of Nigeria (CBN)-approved apps, you will need to follow some steps. First, make sure you meet the eligibility criteria, which typically include being a Nigerian citizen, having a tertiary institution admission letter, and maintaining a good credit score.

Research Different Apps

Do some research on the student loan apps approved by CBN to find one that suits your needs. Some top options are Flash Cash, FINT, M-Kopa Loan, and Renmoney. Compare their interest rates, loan amounts, payback periods, and fees to determine a good choice for you. Flash Cash, for example, offers loans up to N500,000 at a 15-20% interest rate, while FINT provides up to N2 million at rates starting from 5% per month.

Submit the Required Documentation

Once you choose an app, you will need to provide some documentation to apply. This typically includes a copy of your national ID, school ID, admission letter, bank statements, and utility bills. Some apps may require additional documents like pay slips, tax returns, or collateral. Be sure to scan and upload clear copies of all required documents.

Complete the Online Application

The next step is to complete the loan application on the app’s website or mobile app. You will enter personal information, details about the course you want to fund, the loan amount, and payback period. Most apps offer payback periods of 6-36 months. Double check that all information entered is accurate before submitting your application.

Sign the Loan Agreement

If your application is approved, you will receive a loan offer and agreement to review and sign. Carefully read through all terms and conditions to ensure you understand the interest rate, fees, payback schedule, and any penalties before digitally signing the agreement. Once signed, the approved loan amount will be disbursed to your designated bank account, usually within 24-48 hours.

Regularly making payments on time is important to build a good credit history and qualify for lower interest rates on future loans. Some apps also offer discounts or cashback for consistent on-time payments, so be sure to take advantage of those opportunities whenever possible. With the right planning and responsible borrowing, student loans from approved fintech apps can be an affordable way to fund your education.

FAQs

What types of student loans are offered in Nigeria?

The major types of student loans offered in Nigeria include federal student loans, private student loans, and personal student loans. Federal student loans are offered by the Nigerian government and include the Federal Government Scholarship and the Tertiary Education Trust Fund. Private student loans are offered by private banks and non-profit organizations. Personal student loans are offered by individuals, friends and family.

What is the Central Bank of Nigeria’s role?

The CBN regulates all financial institutions in Nigeria, including those that offer student loans. The CBN sets the criteria that banks and other lenders must follow to offer student loans. This includes setting maximum interest rates, loan amounts, and repayment terms. The CBN also maintains a list of approved student loan providers that meet their regulations. Students should only take out student loans from CBN-approved providers.

What are the eligibility criteria for student loans in Nigeria?

The eligibility criteria for student loans in Nigeria include:

Being a Nigerian citizen or permanent resident
Being enrolled in an accredited university or college program
Maintaining a minimum GPA, usually around 2.0
Having a source of income or job offer to repay the loan after graduating
Providing a guarantor, like a parent or guardian, for some loans
Meeting age requirements, typically 17-35 years old

How do I apply for a student loan in Nigeria?

To apply for a student loan in Nigeria:

Check your eligibility for different loan types and ensure you meet the criteria.
Gather the required documents like ID, bank statements, admission letters, etc.
Fill out the student loan application for your chosen lender, available on their website or in-person.
Submit your application with the necessary documents before the deadline.
Attend an interview if required. Provide any additional information requested.
Get approved for the loan. Sign a promissory note agreeing to the loan terms.
Loan funds will be paid out to your school to cover tuition and fees. Any remainder will be paid to you for other expenses.
Make monthly repayments of principal plus interest to pay off the loan amount after graduating or leaving school.