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Education - Loan Recovery

The loan repayment mechanism is one of the components of the students loan scheme aimed at facilitating all those who benefited from the Government loan to study higher education to pay back the loan.

With completion of studies, All loanees are required to start repayment after getting employment or any source income.

In order to ensure a smooth loan repayment process, SFAR collaborates closely with employers of the loan beneficiaries.

Employers, whether in the public sector, private sector, civil society, International organizations, etc are called upon to collaborate with SFAR in the loan repayment by encouraging their employees who obtained a Government loan to start repaying the loans.

Since the loan recovery process started, SFAR has had good collaboration with employers and this has rendered the loan repayment process successful.

Loan Repayment Mechanism Steps 

 
The eight (8) steps below summarize the loan repayment mechanism:


Step 1:
Each loan beneficiary obtains and completes an (INDIVIDUAL STAFF DECLARATION FORM) available at SFAR office or downloadable from (www.sfar.gov.rw) and he/she submits it to the employer.

Step 2:
The Employer completes the (EMPLOYER DECLARATION FORM) available at SFAR office or downloadable from (www.sfar.gov.rw) with all employees who have filled the (ISDF). The employer submits to SFAR the ISDF, EDF and a copy of the payrolls for the two (2) previous months.

Step 3:
Upon receipt of the ISDF, EDF and the payrolls from employer, Using the SFAR-database, SFAR determines the amount of loan to be deducted by the employer from each of the loan beneficiaries.

Step 4:
SFAR informs the employer the monthly loan deductions to be made from each loan beneficiary with effective from the following month. This information is provided to the employer using a (MONTHLY LOAN DEDUCTION SCHEDULE).

Step 5:
The employer starts to deduct the loan as advised by SFAR and deposits the total monthly loan deductions to one of the SFAR Loan Recovery account in the recommended banks.

Step 6:
After remitting the amount on the bank account, the employer is required to deliver to SFAR (Finance department) the following two (2) documents:

- A bank pay-in slip indicating the total amount already deposited to the bank account
- A filed Monthly Loan Deduction Schedule which indicates the list of loan beneficiaries on whose behalf the employer has deducted the funds.

Step 7:
Upon confirmation that the funds have been effectively deposited on the SFAR account, SFAR will issue a receipt to the employer.
 
Step 8:
Upon satisfactory completion of payment of the entire loan, SFAR will issue a (LOAN COMPLETION CERTIFICATE) to the loan beneficiary. This certificate will be presented to any employer to certify that the holder does not have any outstanding loan owed to SFAR.

What is the interest rate on SFAR Loan? 

 
The interest of 5% is applicable from 2008, where started cost-sharing between Government and students.