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Response from Johan Wasserfall, Deputy Chairperson and acting CEO of Edu-Loan:

Edu-Loan is a NCR (National Credit Regulator) registered credit provider and have always supported the ethos and principles of responsible financing.

The company was built on the foundation of providing education finance in a responsible manner, ensuring through affordability assessments that Edu-Loan doesn't over-commit lenders and that they can further their studies with financial peace of mind.

Thus Edu-Loan prides itself on a transparent and responsible approach to financing education. When signing the loan, the terms and conditions are clearly explained and there are no hidden costs. A copy of the agreement is given to the student reflecting all costs, the duration of the loan and the fixed repayment amount.

While interest rates are soaring, an advantage of taking out a loan through Edu-Loan is the instalment is fixed for the period of the contract and therefore not affected by increasing interest rates. Edu-Loan receives payments from their clients through two mechanisms - one being salary deductions from the employer and the second as debit orders. On the salary deduction side of the business, little effect from the interest rate hikes has been seen. Over 90% of loan applications through this mechanism are approved. For the debit order side of the business, Edu-Loan's responsible financing approach and affordability assessments help clients to realise what they are actually able to afford on a monthly basis. Given the current difficult economic circumstances, there has been a decline in numbers for clients who apply for the debit order re-payment option.

When an applicant signs the contract, Edu-Loan's calculations are based on the current interest rate, which is then fixed for the duration of the loan and not affected by further rate increases. This is explained at the time of signing the loan with the applicant.

Having this fixed interest rate has ensured our clients stay happy and know exactly how much they need to budget for each month.

With education being vital to the growth of the country's economy as well as to aid personal growth and facilitate a career, Edu-Loan is continuing to see an uptake in study loans.

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