College Athletes Are Now Eligible to Claim Millions in NCAA Settlement Payouts

A historic $2.8 billion settlement has opened the claims process for thousands of current and former college athletes. The agreement, which receives preliminary judicial approval last week, represents a watershed moment in how college sports compensates its competitors. Those who played from 2016 onward can now begin submitting claims to receive their share of compensation for the use of their name, image, and likeness (NIL).

Understanding the Settlement’s Financial Structure

The settlement addresses a fundamental question: are college athletes paid fairly for the revenue their performances generate? Under this agreement, the answer increasingly becomes yes. The $2.8 billion fund compensates athletes retroactively for missed television and marketing compensation rights over years.

Three distinct athlete categories determine payment levels. Power Five men’s football and basketball players average $135,000 payouts. Power Five women’s basketball players receive average distributions of $35,000. All other Division I athletes qualify for smaller amounts ranging from hundreds to several thousand dollars. The largest individual payout could reach as high as $1.85 million, predominantly benefiting elite football players at revenue-generating programs.

Over 400,000 athletes across all categories are potentially eligible to submit claims. The settlement specifically covers athletes from 2016 forward, capturing a substantial portion of recent collegiate sports history.

Why Football and Basketball Dominate the Payouts

Court filings explain the distribution gap clearly: sports beyond basketball and football contribute “little or no value to the conferences’ media contracts.” Since the settlement primarily compensates for broadcast rights that generated the majority of conference revenues, football and basketball players receive proportionally larger shares. The payout formula, developed by economics expert Daniel Rascher from the University of San Francisco, incorporates multiple variables including school revenue levels, playing time, positional value (for football), and performance statistics (for basketball).

Football players benefit from position-specific calculations using typical NFL salary structures as benchmarks. Quarterbacks will likely receive higher payouts than running backs. Basketball distributions factor in how many additional wins each player generated. Olympic sport athletes, by contrast, might receive only a few hundred dollars despite meeting settlement eligibility requirements.

The Claims Process and Payment Timeline

The settlement website is now live, with eligible athletes receiving notifications beginning Friday. However, individual payout amounts won’t be determined until at least December. Once amounts are calculated, payments will be distributed annually across a period spanning up to 10 years, rather than as lump sums.

Athletes retain the right to opt out and pursue separate litigation against the NCAA and the five named Power Five conferences. A final approval hearing is scheduled for April 7, though legal experts anticipate potential appeals, particularly regarding Title IX compliance questions about equal male-female athletic compensation.

The Future of College Athletic Compensation

Beyond retroactive payments, the settlement establishes a revenue-sharing framework that could fundamentally reshape collegiate athletics. Under the new model, many colleges will be permitted to spend up to $22 million annually on direct athlete compensation, allocating funds according to individual institutional priorities. Approximately 70 schools could implement maximum budgets beginning next summer.

This forward-looking mechanism projects that college athletes could earn between $15 billion and $20 billion through revenue sharing over the next decade. Third-party NIL deals through brand partnerships and alumni-funded collectives represent additional earning opportunities—essentially supplementary income beyond the base revenue-sharing model.

The settlement still navigates legal hurdles and an appeals process, but it represents an unprecedented acknowledgment that are college athletes paid—and increasingly, they will be compensated closer to the revenue their performances generate.