FNB now offering student loans up to R300,000
FNB says it has seen increased demand for student loans, with pay-outs rising by 116% in the six months ending December 2022.
The bank said that the increased payouts are part of its aim to make student loans accessible through the FNB app.
“The cost of education has increased significantly over the years, making it difficult for many to achieve their educational goals and career aspirations,” Amika Maharaj, Business Solutions Head at FNB Loans, said.
“The introduction of student loans on the FNB App has allowed us to provide solutions and help our customers overcome their financial challenges and unlock funds to future-proof themselves in this ever-changing climate. The application process has proven to be easy, safe, and convenient for our customers with great interest since the launch.”
FNB said that the person borrowing the money (principal debtor) must earn a minimum income of R3,000 a month to qualify for a student loan.
If the individual looking to study is a part-time student or employed full-time, they can apply for the loan as a principal debtor – they must still meet the minimum R3,000 income requirement.
A parent or family member of any other sponsor can also apply for the loan, with applications subjected to a credit and affordability assessment.
FNB said that it offers a maximum loan amount of R300,000 a year, with interest rates starting as low as Prime less 0.50%.
The loan amount can cover tuition fees, accommodation, textbooks and all other study-related expenses.
In the first 12-month period, the principal debtor will only pay interest and fees, with repayment after that also consisting of capital.
The bank noted that student loans offer relatively lower interest when compared to personal loans or credit cards, stressing that students should use the loan for what it is intended for and not to fund a lifestyle.
“We encourage customers to pay a little extra on their agreed monthly repayment of the student loan where possible. This helps to save on interest and fees and decrease the total cost of credit.”
“There are zero penalty fees for paying-off the student loan early. Also remember that if additional funding is required for the next year of study, a new application needs to be submitted so only borrow the amount that you need and keep expenses low together with a healthy credit profile,” concludes Maharaj.
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