SLB launches phase two of loan management system
The Students’ Loan Bureau, SLB, is moving on to the second phase rollout of a loan management system that’s intended to reduce the turnaround time on the processing of loan applications.
Usually, it takes an average of two months for student loans to be approved.
SLB Executive Director Nickeisha Walsh said the new system enables beneficiaries and guarantors “to upload documents and has built in API integration with connected third parties, which should reduce the timelines”. API connections allow systems to exchange data.
Still, she noted that the amount of time saved will be dependent on the speed at which applicants complete the process.
The SLB is currently projecting loan disbursements of $4.24 billion for fiscal year ending March 2024.
Overall, $6.13 billion was budgeted for disbursement last year, a sum that included arrears of $2.2 billion due to institutions. The Bureau provides funding to students attending 34 approved tertiary institutions through three loan products: a targeted loan; the Pay As You Study Loan, known as PAYS; and a postgraduate loan.
The targeted loan caters to individuals pursuing undergraduate studies at an approved tertiary institution. Its capped at $1 million in each academic year and repayable after completion of the programme of study, at 7.8 per cent in the moratorium period and 9.5 per cent thereafter.
The PAYS loan, which is capped at $1 million, caters to employed individuals pursuing undergraduate studies or parents or relatives who wish to borrow on behalf of a student. The principal borrower must repay the loan while in school via salary deduction arrangement, at a rate of six per cent on the reducing balance, and one can borrow up to one million dollars.
The postgraduate loan caters to persons pursuing graduate studies at an approved tertiary institution. It offers up to $1.8 million at an interest rate of 9.5 per cent on the reducing balance. Loan payments are done while in school and facilitated via salary deduction.
The targeted loan represents 98 per cent of the SLB’s loan portfolio, Walsh said, adding that interest charged on the loans are unchanged for this fiscal year.
“The typical determinants of interest rate, such as credit score, payment history, credit line and income, do not play a significant role in pricing our targeted loan product,” said the SLB head.
“However, these determinants will be considered in pricing the PAYS and postgraduate products,” she added.
The targeted loan is repayable in 15 and 20 years, depending on the programme of study.
“The Students’ Loan Bureau is the only financial institution in Jamaica that affords persons the flexibility to repay their student loan after graduating, thereby alleviating any financial burdens while in school. This means that students can stay focused on their academic goals,” said Walsh.
“Contrastingly, at other financial institutions repayment is required immediately upon disbursement of the tuition. Additionally, we boast one of the lowest interest rates in the market space and place,” she said.
The SLB also offer special concessions to wards of the state, PATH beneficiaries, children of public sector workers, and persons pursuing degrees in a STEM programme or engaged in the study of logistics, maritime, agriculture and information communication technologies, she added.
The bureau has also been offering grants in the amount of $50,000 to students in dire need of financial assistance.
“This allocation will increase to $60,000 for the upcoming academic year,” Walsh said.