More student loans on offer
It is that time of the year again when students are contemplating to further their studies.
Besides the angst over what to study, many students also face the added stress of how to finance their studies.
While banks have traditionally been the first port of call for a student loan, the stringent qualification criteria that they apply means that only about 10 percent of applicants will qualify for finance.
But Emil Gryffenberg, general manager of merchant finance at Real People, says there is still hope for less fortunate students through government aid schemes and alternative credit providers, which have developed more accessible financing solutions.
Gryffenberg explains that government focus on education has seen the introduction of a National Student Finance Aid Scheme. This scheme gives finance to the most destitute students (estimated at 40 percent).
But this funding often only covers 60 percent to 80 percent of students' education needs.
Worse still, an alarming 50 percent of these students will not be able to access funding, says Gryffenberg.
For these students, he says, another avenue has fortunately opened.
In the case of the traditional student bank loans, guardians are required to sign surety and the students pay back the loan after they qualify.
But there are a few other credit providers that Gryffenberg says offer alternative financing options whereby loans are granted without the need for surety.
While the interest rates tend to be higher than those of the banks, Gryffenberg says Real People has developed ways in which these rates can be reduced.
The credit specialist, Gryffenberg says, has negotiated with certain tertiary institutions to offer students a discount on tuition fees by discounting the interest on the loan should the institution discount the fees.
This means that the student will benefit from a reduction in interest rate as well as the tuition fees.
Another way in which students can apply for a loan is to contact Real People directly by providing it with their sponsor's supporting documentation, a quotation from their institution of choice and proof of registration.
The registered course is paid directly and proof of payment is then sent to the student.
Gryffenberg says students first have to contact the tertiary institution to ascertain whether the institution provides, or has a relationship with any credit providers.
If there is no such relationship, the student will have to contact Real People directly, advises Gryffenberg.
"Students have a variety of options available to them and if they do their research, they should not have a problem finding someone who will help them finance their ongoing education," Gryffenberg says.