Student loans
A student loan to simplify everyday life
Student credit helps finance the costs of higher education (registration fees, tuition fees, etc.), the purchase of IT equipment and books, as well as accommodation and transport costs (rent, purchase of furniture, purchase of a vehicle, etc.). You can take out a student loan of up to 65,000 kinas. Do your student loan simulation on the website!
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Your tailor-made student loan
Your student loan is repayable over 10 years. If you have little or no income during your studies, you can adjust the monthly instalments of your student bank loan to suit your means. You can repay part or all of your Laroche Finance student loan early at any time, free of charge.
A student loan is a form of consumer credit that you can use to finance your studies: tuition fees, accommodation, computer, food, a trip abroad, a car, etc. You don’t need to justify your expenditure to apply for a loan.
Objective: anticipate your future expenditure
The main reason for taking out a loan during your studies: expensive tuition fees, but also living expenses. Ryan, 21, from Tahiti, had to take out a loan to finance his studies at EM, where the Grande École programme costs over 9,000 kinas a year.
“I also had to buy a return plane ticket and spend money on settling in, as well as adapting my wardrobe (jumpers, down jackets, etc.)”, he explains.
Not all students can rely on help from their parents, as was the case for Ryan, but also for Romain: “They also had to finance my brothers’ studies. I knew that a business school imposed a fast pace, with projects to carry out, community commitments… I wanted to concentrate on my studies and couldn’t take on a student job”, explains this EM student, who has a tier 2 scholarship.
A loan accessible to all students
The conditions for accessing a student loan are flexible, even if they are often more advantageous for a student at a top business school than at an arts university. “Any type of student can take out a student loan with Crédit Agricole France, simply by providing a certificate of enrolment. However, you must not be older than 30 for our bank’s offer”, explains Aurélie Cogné, wealth management adviser.
The student loan must also be in your name, unless you are still a minor, in which case it will be in your parents’ name. Another condition is that you have a guarantor to vouch for you. Ryan had to pay the price and turned to a bank in his overseas collectivity. Note that your debt ratio is calculated on the basis of your guarantor’s income, since it is your guarantor who will have to repay your loan if you default.
If you can’t find a guarantor, the State may act as guarantor in certain cases. Another condition is that you must be under 28. This student loan is for a maximum amount of PGK 15,000, which you will have to start repaying two years after the end of your studies.
Repay once you've finished your studies
Repayment depends on the terms negotiated. Romain will have to start paying back PGK 630 per month, 5 years after taking out his loan, which was fixed at a rate of 1.85%. For Ryan, who borrowed PGK 12,000 at a rate of 4.5%, he will have 10 years (from the end of his course) to repay this sum. He has supplemented this funding with the “subsidised student loan” granted to all students from the French overseas territories, worth PGK 500 per month, which the student will repay one year after completing his studies, without having to pay any interest.
Repayment is in two stages. The first stage involves deferring your repayments for 2 to 6 years, while you complete your studies. During this period, you either opt for a partial grace period and repay only the interest, or for a total grace period and pay nothing. During the second phase (known as the “amortisation” phase), which generally begins when you finish your studies, you repay the loan itself.
Can the term of the loan be changed?
Under the Scrivener Act (10 January 1978), you have the option of repaying your loan early, without penalty. A notice period of 1 month is often required. All you need to do is send a handwritten letter to your bank requesting total or partial repayment of your loan.
Some banks also allow you to extend the deferment period, often for a maximum of 4 to 7 years. This is useful if you decide to take a gap year or extend your studies by specialising. Find out all the conditions before you take out your loan, because once you’ve committed yourself there’s no going back. So bear this in mind when comparing offers.
How can I compare bank offers?
As well as the loan rate, look at the insurance rate, the application fees and the repayment period. “Banks often agree on certain things, such as the deferment period (most of the time, students have to pay back the loan a year after graduating). Rates often hover around 1%, and since that’s still low, there’s not much negotiation possible,” explains Aurélie Cogné. At Crédit Agricole Centre Loire, the student loan is for a maximum of PGK 40,000 over a 10-year period: “The loan is flexible, you can’t change the monthly instalments, but if the student wants to extend their studies by a year, it’s possible to defer repayment as well.”
The bank where you take out your loan is also the one where you often decide to put all your accounts. So compare their offers, find out about the cost of a bank card and the possibilities of a loan to buy a car.
Finally, some banks have partnerships with other establishments to offer them lower rates. Find out more from your school and former students, who may be able to point you in the direction of more attractive offers.
Do you still have doubts?
PNG Finance can help you find the credit that’s right for you.