Tuesday, October 14 2014 12:45
Areximbank-GPB Group provides education loans for students
ArmInfo. "As compared to other consumer loans, the student loan is less risky," says Eduard Karapetyan, Senior Specialist at retail Lending Division, Areximbank- Gazprombank Group (GPB). According to him, "the most important investment is the investment in our children, their education and development. These investments will be regained in future."
Karapetyan says: "In the 21st century every young person has a right to education, but not everyone can afford it. Therefore, it is twice gratifying to see that our government has approved the program of education loans at the higher educational establishments in our country." The government program of student loans was introduced in the spring of 2013. Areximbank join the program in the summer of 2013 and provided the first loans already in September.
"Since the launch of the Program, we have provided loans to the students of the Engineering, Agricultural, the Russian-Armenian (Slavonic) universities. Some banks provided loans from their own funds before but for less favorable terms than the ones the Government offers now. This Program subsidizes even the interests on loans. For instance, for excellent students, the Government subsidies up to 3% of the interests on the loans, while for others the subsidies are 2%. As you can see, studying excellently is also motivated financially," he says.
Nevertheless, Karapetyan outlined a problem in the loan registration procedures, when there is no adequate guarantor. Guarantors must not have any big borrowings. "For instance, if you want to take a student loan for your son, but you still have other loans to repay, the monthly payments must not exceed 40% of your salary. No other problems. In case of all the necessary documents, a loan will be registered and provided within a couple of days," he explains.
To recall, under the Government program of student loans, persons at the age of 16-30 can take loans to pay for their education for a Bachelor's or Master's Degree. The loan maturity is up to 10 years. It is noteworthy that the borrowers are required to pay only the interests on the loan within the first 4 years. After graduation, the primary loan and the interests are repaid in terms of equal amounts. The annual interest on the loan is 12%, with the maximum loan amount being 1.8 million or 450,000 for each education year. It is noteworthy that the loans are provided subject to signatures of at least 2 guarantors- residents of Armenia and/or legal entities with stable monthly income. One of the guarantors must be the student's parent even if he does not work (as a third guarantor with no incomes).
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