The National Association of Proprietors of Private Schools (NAPPS), has called for the establishment of an education bank which would service private schools in Nigeria with loans at single-digit interest rates. This call was made recently by the Deputy Chairman of NAPPS, Yomi Otubela, at a press conference in Lagos.
Otubela disclosed that financial institutions in the country give loans to private schools at 25 to 30 percent interest rate, which makes rendering quality education come at a high price for private schools. According to him, “no bank is giving at anything less than a double-digit interest rate.”
He added that just as the Bank of Industry (BOI) serves the Agro-allied companies, NAPPS, therefore, canvasses deliberately for an educational bank. This would enable it to acquire loans at a single-digit and push for grants from donors to facilitate the delivery of quality education.
There are no direct policies that place a fixed percentage of interest rates that banks should operate on by the Central Bank of Nigeria(CBN). CBN has made the interest rates on lending fees negotiable as stated on its Bank Charges Circular. This means that banks are generally free to determine the interest rate on deposits and charge for loans. This leaves the private school sector at the mercy of the banks. If the government can respond to the call of NAPPS and provide an education bank as they did for the agricultural sector, more children are bound to get quality education at affordable rates.
Why the government should provide an education bank.
President Muhamadu Buhari’s administration has made moves to improve the quality of education in Nigerian public schools. Despite efforts made so far, a UNICEF report still shows that about 10.5 million children aged 5-14 years are not in school. Only 61 percent of 6 to 11 year-olds regularly attend primary school and only 35.6 percent of children aged 3- 5 years receive early childhood education.
“The numbers are increasing and we have to do something. Government has tried but their attempts have not yielded much result. Else we’ll leave our teeming population uneducated and it will not be good for our national development.” Otubela remarked to the press.
Due to this high rate of children without access to education, there is a need for the government in conjunction with other private sectors to synergize with NAPPS. The government should look into creating platforms that would enable the private subsector to have access to loans at lower interest rates with a flexible repayment plan.
By Ishioma Emi