A solution to solve the back to school puzzle. But how do you know if it’s the right one? Many student parents use school loans to guarantee their children’s academic year. Yet this solution could become a true sword of Damocles overhead.
This is the school loan fair. A few months into the school year, banks offer solutions to parents to allow them to easily pay for their children’s school. But it is often difficult to choose among a thousand proposals. Conditions don’t really change either.
“The school loan is a product designed for the financing needs of studies. Specifically, it is a credit granted on the eve of the school year to the bank’s salaried customers to allow them to finance the education of their children ”, read the brochures of some banks.
According to Landry Kouamo, a banking expert, there is not much difference between the different school loan proposals in Cote d’Ivoire.
” Competition between banks and the products they offer is less evident in Africa and more particularly in the Ivory Coast than in Europe. It will be said that one bank lends more than the other, but the conditions are basically the same. As for the school loan, you will be required to have an account with the bank where you apply for the loan. The interest rate varies slightly between establishments but it’s not a big deal. Some banks talk about 0% interest rates but with high processing fees. They reach out their right hand and withdraw their left hand “, he says.
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Banks lend on a salary basis. The higher it is, the higher the regulatory share. While some factories are limited to 2 or 3 million FCFA, others go as high as 5 million FCFA. The duration of the loan generally extends beyond 10 months. But some establishments can go up to 12 months.
” You need to know your initial contribution before taking out a bank loan. If you have a $ 3 million education to fund, you must first have at least $ 1 million in FCFA before applying for a loan. The goal is not to allocate a large part of his salary to a repayment that spans several months. Otherwise the best advice is to anticipate the start of the new school year by saving a certain amount every month, even if a minimum. Because in any case, the lending bank wins. And you may find it difficult to take the noose off your neck “, He reveals.
Sometimes the school loan can become a real problem for the subscriber, especially if diverted for other purposes.
” There are also subscribers who take school loans even if they don’t have children. “, A manager confides to 7info.
The most important thing is therefore not the bank granting the loan but the possibility of repaying the loan without affecting income.