How does NIL money work in college football? Explaining the meaning, rules and who pays the athletes

JUMP TO: 

• What is NIL in college football?
• NIL money meaning
• How does NIL work?
• NIL rules in college football
• Who pays NIL money?
• NIL money by school
• Highest-paid college football players

College football — and really, any NCAA sport — looks a whole lot different nowadays than it did even a decade ago. NIL has played arguably the biggest role in that.

In 2021, the NCAA officially changed rules to allow student-athletes to profit from their name, image and likeness, abbreviated as NIL. Those changes have altered the entire college athletics landscape, especially in a major revenue-driving sport like football; not only are college athletes now being financially rewarded for their stardom, but there are often more (unofficial) "bidding wars" for star players.

Of course, there are very key rules and regulations that college teams have to follow. As NIL allows players to reap the benefits of their fame, there's a lot to know about the process.

Here's a full breakdown of how NIL works, specifically in college football, including a look at the highest-paid athletes and total money by school.

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What is NIL in college football?

NIL stands for "Name Image and Likeness". It refers to a college athlete's legal ability to earn compensation for their personal brand. Prior to 2021, collegiate athletes were not allowed to profit off their personal brand beyond scholarships.

With the 2021 change, which came as a result of the Supreme Court's decision in "NCAA v. Alston" and new NCAA policies, college athletes became more similar to professional athletes in the sense they could financially profit off their performance and brand. Student-athletes were previously considered amateurs, and therefore prohibited from receiving monetary compensation for their accomplishments. Not only did that lead to plenty of behind-the-scenes scandals involving recruiting, but there was a longstanding push for college athletes to be compensated.

With NIL, players can earn a piece of the financial pie that traditionally all went to the school itself. The changes have led to universities finding unique ways to generate revenue.

In June 2025, the "NCAA vs. House" class action lawsuit also changed the landscape; the NCAA agreed to allow its member institutions to distribute funds to Division I athletes who have played since 2016. NCAA institutions became allowed to distribute funds up to $20 million to those athletes, with a cap increasing annually. Reports indicate that most of the compensation, whether for active or former athletes, will go toward major revenue-generating programs such as football, plus men’s and women's basketball.

Under the House settlement, student-athletes are still able to continue to sign NIL deals with third parties, but it also permitted the NCAA and conferences to enforce standards on deals to prevent schools from circumventing the salary cap; all third-party deals must be for a “valid business purpose” at “fair market value." All deals over $600 must be reported, with a new non-NCAA enforcement authority, the College Sports Commission, set to monitor and enforce those rules.

Here are some of the types of NIL deals that athletes can land:

• Endorsements, including public appearances for a brand/appearing in a commercial
• Social media promotions, like paid advertisements and content
• Selling autographs and merchandise, like branded clothing or signed gear
• Making appearances/hosting events

Collectives are also a significant portion of the landscape; usually, they are a booster organization that is separate from the university, but generates money from donors, businesses, fans and alumni to create NIL opportunities for athletes.

Especially in football, the top revenue-driving sport, NIL has become a very significant portion of team-building, although unintentionally. A big financial package from a collective has been known to swing star recruits or transfers from one school to another.

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NIL money meaning

When people refer to "NIL money," it means the compensation a college athlete is earning through their Name, Image and Likeness rights, through deals with companies, brands or other organizations.

NIL money can come from endorsements, social media posts, appearances, or any other kind of arrangement between the athlete and a company or collective. For example, a star quarterback may sign a $100,000 NIL deal to promote a clothing brand in a commercial, or a player may receive $2,000 for making a social media post promoting a brand.

NIL doesn't always directly relate to the athlete's performance on the field, as "NIL money" just generally refers to the athlete's brand and ability to profit on their name, image and likeness. 

Arch Manning, for example, had an NIL deal with Warby Parker, and he appeared in a commercial for them. 

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How does NIL work?

NIL does not involve schools directly paying players themselves, like a professional salary. However, schools can connect players to NIL opportunities with third-parties, like a collective, company or brand. Similarly, an athlete or brand could reach out to one another to talk about a deal.

The athlete and business/collective then usually agree to a contract and terms, with the athlete benefitting the brand in some way (appearances, posts, etc.) in exchange for compensation.

Athletes don't have to be financially compensated, either. Sometimes, brands just offer the athlete the thing they sell (clothing, cars, sneakers, etc.) essentially for free, in exchange for the athlete's endorsement. 

Ideally, NIL was not intended to be a tool for recruiting. But in reality, it has become exactly that; larger schools can often generate more money in their collectives, which aren't directly involved with the school/team itself, but recruits are certainly aware of which schools have more NIL dollars to take advantage of. So in many ways, NIL and collectives have a ton of influence in the landscape of which recruits and transfers land where.

Often, the athletes who reportedly make the most in NIL dollars are either among the most talented/dominant in their sport, have a significant social media presence, or a combination of the two.

Still, even the lesser-known college athletes and football players often score deals with local companies and collectives. There have been plenty of unique NIL dealings that didn't come from the basic name-brands or star players, like Reese's Peanut Butter Cups working out deals with college athletes with the last name "Reese."

Most schools require athletes to report any details of potential deals, with some requiring school approval before they sign. 

Athletes are permitted to have advisors or agents to help them with NIL and other business dealings. Many schools also often offer training and other resources for their athletes to understand NIL and best business practices.

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NIL rules in college football

Between school policies and state laws, there are rules in place for what deals an athlete can make. If they're in a state that offers no insight, then the NCAA has its universities write policies for its own athletes, with requirements often including advice/training before taking deals, preventing them from promoting certain products like drugs/alcohol, etc.

As for the state laws, they're often more focused on preventing NIL from becoming a tool for schools to recruit, which has grown into more of an issue over the years. Direct pay-for-play is not allowed for schools, whether as a salary or performance-based, but collectives and some of their relatively undemanding requirements for the athletes in deals have made that a murky area.

Officially, NIL opportunities cannot be guaranteed in an attempt for an athlete to pick a school. But collectives often still find ways to advertise their packages, and because school booster clubs supported by fans and alumni are legal, there are varying state-by-state rules on just how involved a booster club can get.

There's still little uniformity for NIL rules because there are state-by-state rules, but the NCAA has emphasized its interest in more federal guidelines for NIL.

There are also varying rules about reporting NIL deals based on state or university. Most athletes are required to report all NIL deals to their school for compliance and clarity. 

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NIL rule changes for 2025-26

There are some significant changes with NIL for 2025-26. On June 6, 2025, a federal judge approved a settlement in the House vs. NCAA case. The biggest change stemming from that settlement is that schools will now be allowed to make direct payments to athletes. Here are more details on the changes. 

• Direct payments from schools to athletes: The cap for direct NIL payments is set at $20.5 million per year for schools that opt in.
• Opt-in model: Schools do have to opt in if they want to make direct payments. Schools that do not opt in, will continue to play under the older model of NIL rules.  
• Oversight: The College Sports Commission (CSC) was created to be an independent body overseeing the new NIL compensation structure.

Who pays NIL money?

NIL money historically has not come from the school or university itself, as that would have been a violation of the original rules. Instead, the money comes from the business, brand, company or collective that the athlete agreed to a contract with in exchange for an endorsement or other agreements.

For example, it would be the brand like Nike or Under Armor paying the athlete who inked a clothing brand deal, rather than the money going through the school. As for collectives, they often arrange NIL deals for players in exchange for appearances, charity events or more. Collectives raise money from fans, wealthy boosters, alumni and more.

Athletes are also allowed to receive money from their own business ventures, like monetizing their social media accounts or selling merchandise. In that case, the money would be going from consumers to the athlete.

Shedeur Sanders, and the rest of his family for that matter, were featured in an Oikos yogurt commercial during the 2023 Super Bowl. 

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NIL money by school 

There are little "official" numbers on NIL money, as it's been a scramble for schools over the years to get adjusted to the changes, and there are no requirements for schools to report how much in NIL their athletes are earning.

However, there has been at least some research in discovering which schools have the upper-hand in booster generosity with their collectives. In 2024, 247Sports looked into which schools have the most generous athletics boosters.

Here's how 247Sports ranked the top 20 teams in NIL efforts in 2024:

Additionally, in 2023-24 NIL-NCAA found that in terms of NIL collective funding per school, it was Texas (with $22,272,474), then Ohio State, LSU, Georgia and Texas A&M that ranked at the top.

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Highest-paid college football players 

There have been plenty of college athletes, especially in football, to reap the benefits of NIL. Again, NIL valuations for players often depend on reports and other methods since there are no official numbers everywhere, but there are rough estimates for the top earners in college football.

On3 estimates NIL valuations, which "measures an athlete’s market value in terms of licensing and sponsorship." Here are the top-10 earners among college football players in 2025, per On3: