When Does NELFUND Loan Repayment Start – And What If I’m Unemployed After NYSC?

If you’ve received a NELFUND student loan, a question many students ask is:

“When do I start paying back the loan?”
️ “What if I finish NYSC but can’t find a job immediately?”

1. Repayment Starts After NYSC – But There’s a Grace Period

Once you finish your National Youth Service Corps (NYSC) programme, you don’t start paying back the loan immediately.

The repayment period begins two years after you’ve completed NYSC.
This two-year period is a “grace period” a break designed to give you time to settle into life after school, look for a job, or start a business before repayment begins.

So, for example:

• If you finish NYSC in December 2025, repayment normally starts in December 2027.
• But if you get a job before that two-year window, you can start repayment earlier by choice.

2. What Happens If You Get a Job After NYSC?

If you secure a paid job, here’s how repayment works:

✔️ Your employer will deduct 10% of your monthly salary and remit it directly to NELFUND on your behalf.
✔️ This deduction is usually handled automatically through payroll once your employer confirms you’re a NELFUND beneficiary.
✔️ You don’t have to chase NELFUND yourself – your employer does the heavy lifting.

This means you don’t start paying back the loan as soon as you graduate — only when you are earning income.

3. What If You’re Unemployed After NYSC?

Here’s the good news:

If you don’t have a job – even after two years – you are not required to start repayment until you are employed and earning.

According to NELFUND officials, if you remain unemployed after the two-year grace period, the Fund cannot compel you to pay, because you don’t have income to deduct from in the first place.

This means:

• You won’t be harassed or forced to pay if you have no income.
• You only begin repayment once you are earning a salary – even if this is longer than two years after NYSC.

This provision makes the scheme fairer to new graduates facing a tough job market.

4. A Few Extra Things to Know

Early repayment: You can choose to start paying back the loan before the two years if you’re already earning and able.

Self-employed graduates will manage repayments themselves – meaning you decide how to transfer your monthly contributions once you start earning.

No interest: NELFUND loans are interest-free, but repayment is still mandatory once you’re earning.

In Summary

Situation	When Repayment Starts
You finish NYSC and don’t get a job	No repayment until you start earning
You finish NYSC and get a job within 2 years	Repayment begins when you start earning
You finish NYSC and stay unemployed for 2+ years	Repayment begins only once you’re earning

Final Tip for Students

Keep your employment status updated with NELFUND once you start earning, and make sure your employer knows your NELFUND status so deductions can begin smoothly. This will help you stay in good standing and avoid any confusion later on.