Loan account, interest and responsibilities
For every Student Loan you take out, we set you up a loan account once your loan is approved. The loan account keeps track of your transactions. You will also get regular loan statements showing your transactions, including interest and the balance.
On this page:
The Student Loan account
We will set up a loan account for you once your loan is approved. This is an account that keeps track of your transactions.
In most cases, your loan account with StudyLink will run for 52 weeks from the day you start your course - unless your course finishes before 31 December in which case it will close on 31 December.
Each loan account closes on 31 December following your course end date. You can't use your loan once your loan account has closed.
After your loan account has closed, your loan balance will transfer to Inland Revenue on 28 February the following year.
Inland Revenue will be responsible for collecting repayments from you until your Student Loan is paid back.
You need to take out a new loan (and open a new loan account) for every year of your studies.
You can have more than one loan account
In some cases you may have more than one loan account. If you are studying more than one course, and your second one starts before the other one finishes, you may have two loan accounts.
You'll need to sign a new loan contract (we'll send this to you) and pay an establishment fee for every loan account you open.
Interest rate and Interest free Student Loans
Interest is charged daily from the first day that you use your loan until you have repaid the loan in full.
The interest rate is 6.6% pa. Rates are reviewed on 1 April each year.
Any Student Loan borrower who has been in New Zealand for 183 or more consecutive days will be eligible for an interest free Student Loan.
Interest charged will still show on your statements, but will automatically be written off by Inland Revenue at the end of the year. Inland Revenue will send you confirmation of the write-off after April.
Go to the Inland Revenue website for more information on interest-free student loans.
Student Loan establishment fee
You'll need to pay a $60 establishment fee every time you open a loan account.
The fee is added to your loan as soon as you use it. Once your loan is approved and your loan account opened, you will be able to use your loan.
Please note: the establishment fee was previously known as an administration fee.
Inland Revenue administration fee
The Government has also announced that a $40 annual administration fee will be introduced for Student Loans that are transferred to Inland Revenue. This fee is subject to legislation due to be passed later in 2011.
It is expected that the administration fee will:
- not be charged any year where a student also had a StudyLink establishment fee charged
- be charged each tax year from the tax year ending 31 March 2012.
How to check your loan balance
You'll get regular loan statements that show your transactions, interest charges and loan balance.
The final loan statement will be sent to you after your loan account has been closed.
It will show:
- your loan balance as at 31 December
- the interest charged
- all your transactions for the year
- the date your loan will transfer to Inland Revenue.
You can check your loan balance or ask for another statement at any time by using your MyStudyLink account.
What to do if you don't agree with your loan balance
While your loan is still with us, there's a standard process for disputing your loan balance. It's important you follow it so things can be sorted out as soon as possible.
Paying back your Student Loan
You can start paying back your loan while you're still studying, even if you're earning less than the repayment threshold.
You can make repayments towards your loan anytime after you've received your first payment, up until your loan is transferred to Inland Revenue (on 28 February of the year after your course finishes).
If you earn more than the repayment threshold of $19,084 (about $367 per week) for the tax year 1 April to 31 March, you are required to start making repayments towards your loan even while you are studying.
Make sure you register for Inland Revenue's online services, it allows you to view details about your account, file returns, send mail and update details such as bank account, addresses and phone numbers straightaway. You can also request an up to date statement for your Student Loan account.
