To pay for their tertiary education, South African students have continued to turn to student loans as an alternative to bursaries and government funding programmes such as NSFAS. One of the many financial institutions, that have started providing student loans to people in need of funding is Capitec Bank.
Student loans, like the one offered by Capitec Bank, are always repayable, in contrast to some bursaries, scholarships, and government support programmes which can don't require repayment.
Because Capitec Bank offers student loans as unsecured loans, it differs from other financial institutions in that it does not request that applicants list a principal debtor or pledge their home as collateral.
However, the applicant’s ability to pay back the student loan with interest is still one of the crucial parts of the student loan agreement. With this in mind, Here is how Capitec Bank calculates interest on their student loans.
The interest rate on a student loan for R 10,000 for a two-year term ranges from 14.20% to 24.75%, and the monthly repayment amount is roughly R1105.06 each month. If you apply for a loan of R25,000 for the same two-year term, the interest rate will similarly start at 14.2%, and your monthly repayment amount will be R1,397.74.
Additionally, there are several requirements that the applying student must fulfil to ensure that they are not a financing risk to the bank because they are expected to pay back a specific amount. These include the following documents:
- Invoice/quote from the student’s choice of college between the four listed above
- Student’s valid South African ID
- The last three payslips of the person responsible for the loan
- Bank statement revealing the person’s last three salary deposits
Each rate at which the loan is covered depends on the partner institution where the student plans to pursue their studies. Click here for more information, including how to apply for a loan through the different partner institutions.
