Economic Crunch: Nigerian Student Deposits to UK Universities Plummet by 65%

The ongoing economic challenges in Nigeria have led to a significant decrease in deposits made by Nigerian students to universities in the United Kingdom for the upcoming academic session commencing in September 2023. According to a recent report by the Financial Times of London, there has been a staggering 65% drop in payments compared to the previous year.

The report also highlighted a 44% decline in deposits from Indian students during the same period. Nigeria and India are among the top three contributors to the international student population in the UK, making these declines particularly concerning for British higher education institutions.

Declining Numbers Across the Board

Data sourced from Enroly, a web platform utilized by one in three international students for enrollment management, revealed a 35% overall decrease in deposits for UK university courses by foreign students this August compared to August 2022.

Paul Kett, Senior Education and Skills Adviser at PwC UK, expressed concern over the situation, stating, “Some [universities] will likely need to take further significant action to secure their financial sustainability.”

Despite a slight recovery observed this month, the number of international students applying to UK universities remains significantly below recent levels. In May, the drop was recorded at 57% compared to the previous year, indicating a persistent downward trend that could lead some institutions into financial crises.

Government Responses and Policy Implications

Last month, Education Secretary Bridget Phillipson affirmed that the new Labour government intends to welcome international students. She criticized the negative rhetoric of the previous Conservative administration, which had aimed to reduce overall migration figures through restrictive policies.

Jeffrey Williams, Enroly’s Chief Executive, noted early signs of recovery attributed to efforts by the new government to stabilize immigration policy. “Concerns regarding the potential elimination of the postgraduate route work visa have been assuaged,” he said, adding that this stabilization has been aided by ongoing political uncertainties in other markets such as Australia and Canada.

Harry Anderson, Deputy Director of Universities UK International, emphasized that the international environment remains volatile for universities. He pointed out that institutions are actively working to diversify the range of countries from which they recruit students. However, Anderson expressed concerns over Labour’s decision to retain the Conservative’s ban on most graduate students bringing family members, stating, “Most of our competitor destinations do allow students to bring their family members, and most of the growth in recent years has been in postgraduate taught courses where students typically tend to be older and have family members.”

Financial Precautions and Future Outlook

In anticipation of potential financial strains, the Office for Students (OfS), the UK’s higher education regulator, has begun preparing for a possible wave of university insolvencies. The OfS has advertised a contract worth up to £4 million for professional services companies to manage restructuring programs. This move follows financial reports revealing overly optimistic assumptions about the growth of overseas recruitment in the coming years.

In its annual report released in May, the OfS criticized universities for an “optimism bias,” citing projections of a 35% growth in international entrants between 2022 and 2026 as unrealistic.

Impact on Nigerian Students

Amid these international dynamics, data from the Central Bank of Nigeria’s balance of payment compilation for the first half of 2023 shows that Nigerians spent $896.09 million on foreign education, with a substantial portion directed to the UK. Foundation courses in the UK cost between £10,000 and £15,000, with the average student requiring an additional £8,000 annually for other expenses.

Smaller markets such as Kenya and Nepal have shown increased demand compared to the previous year, offering a glimmer of hope for UK universities seeking to diversify their international student base.

As the new academic session approaches, UK universities, the Nigerian government, and prospective students will be closely monitoring these developments, hoping for economic stabilization and policy adjustments that could reverse the current downward trends in international education enrollment.