All the educational financial aid from now on will be from the government. You already know their track record for running things.
Actually this is one area that they have their stuff together. I have never had a problem with the money being credited to my kids' accounts in a timely manner. I simply completed the FAFSA as soon as I had finished my taxes, the aid package was completed and forwarded to their school.
I think you are referring to student loans, which is just one part of the total financial aid package and, yes, these will be handled by National Direct Student Loan. This is an important change as some of the private lenders were taking advantage of students and their families with some of the terms that they imposed, to include variable rates and upfront fees. They would also set up tables near the registrar's offices in order to drum up new business. This was also true with the credit card companies--they would hand out free T-shirts or other trinkets if you signed up for a credit card and you had kids graduating college with $10-20K or more of credit card debt, in addition to their student loan debts.
I guess change can be good.