This article contains information on the types of student loans in South Africa in 2023.

It is no doubt that studying in tertiary institutions is often expensive. This, however, isn’t a limit to getting the best out of education. The good news is that there are available options to choose from, to assist in financing your tertiary education if you can’t afford it. As a student seeking assistance in funds for tertiary education, student loans are realistic and readily available for you to make your dream of studying in South Africa come true.

To become successful and wield a good job and career, you need a tertiary or university education. It is a requirement. In the same light, it is often very expensive to further your education to the tertiary level in South Africa.

Most families find it difficult to support their children as they do not have sufficient funds and savings to back them up. A good solution is available in the form of student loans. Below are the types of student loans in South Africa.

Types of student loans in South Africa

Student loans available to students through the platform of the National Student Financial Aid Scheme (NSFAS) are funded by the government.

Private lenders also give student loans from the major banks in South Africa and sole credit providers.

1.  Government Student Loans

NSFAS Student Loans

This is readily available to South African students who get enrolled into any of the public universities in the country. They are structured to assist students in paying for university expenses, which include tuition fees, food, accommodation, travel expenditure and expenses on materials and books.

Amounts on loans are determined based on the individual. Interest rate is 80% of repo rate. This is quite lower and favourable than interest by banks on personal or student loans.

Method of Application

• To qualify for an NSFAS loan, you are required to pass a means test and be in good academic standing.
• No attached collateral or financial requirements are included to be met by parents or guardians.
• You start paying back the debts once you graduate and start earning an income of your own. This should be above R30,000 per annum. If your income at the end of the year is lower than R59,000, payments will become 3% of your salary per year. If the reverse is the case, it becomes 8%.
• Check HERE for full details on the method of application.

2.  Bank Student Loans

Like more student loans, they cover student expenses such as tuition, textbooks, accommodation, study materials and traveling, like in the case of Government loans. However, their method of operation is slightly different.

Method of application

Application will be done by a surety for the student, which is most times a parent or guardian and in some cases a sponsor supporting you. The surety must have a high income and low debts, with a clear history of credit to secure a loan for you.

Amount on loan is set based on the individual needs of the student. Also, the amount of disposable income for the surety is put into consideration. Unlike NSFAS Loans, interest rates are a bit higher, although they vary with lenders. Therefore, it is necessary to do a comparison study of different offers available before making a choice.

Repayment rates are dependent on how creditworthy the surety is. Bank student loans are often structured into two periods;

The first covering the period when the student is still in school. At this time, your surety is required to make only payments on interest. Upon graduation, you are expected to pay back the remaining interest and capital in monthly installments.

Terms and conditions for payment will be fixed beforehand. A period of grace is granted for graduates who have to undergo internship or voluntary service. To be on the safer side, it is better to compare various student loans available before making an application for any course in a South African university

Some of the lenders include:

• NEDBANK
• STANDARD BANK
• ABSA
• NATIONAL STUDENT FINANCIAL AID SCHEME (NSFAS)
• FIRST NATIONAL BANK
• FUNDI
• STUDY LOANS SA
• IZWE LOANS
• LIKE MONEY
• URGENT CASH LOANS
• EDULOAN
• JUST MONEY
• JUST AFFORDABLE LOANS
• EC FINANCE
• SA LOAN SERVICE
• LOAN TYCOONSA
• LEGAL LOANS
• INSTANT ONLINE LOANS
• PICOTIFIN

3. Postgraduate study grants:

These grants from the National Student Financial Aid Scheme (NSFAS) provide funding for postgraduate studies on a means-tested basis.

4. Bursaries and scholarships:

A variety of bursaries and scholarships are available to support students studying at any level.

Don’t miss out on current updates, kindly like us on Facebook & follow us on Follow @Eafinder OR leave a comment below for further inquiries.