Personal Loans Being Used For Education

An estimated £37 million worth of personal loans were taken out last year to help pay for school fees, unitversity fees and general education costs.

According the Sainsbury’s Finance, almost 4,000 personal loans worth an average of around £8,500 were taken out for these reasons.

Of these 4,000 personal loans, around 1,100 were taken out to help pay for school fees, 1,900 for university and college costs and the balance for other general education costs.

Steven Baillie, Head of Loans, Sainsbury’s Finance said: “The cost of education has been rising.  School fees rose by 5.9% in 2009⁽¹⁾, and the education component of the Consumer Price Index increased by 5% in the 12 months to February 2010.  These rises can be hard to bear in difficult economic times, so it is not surprising to see many people taking out personal loans to help with this cost.”

Sainsbury’s Finance offers the most competitive personal loan rate of 7.8% APR typical for loans between £7,500 and £14,999 for Sainsbury’s shoppers. Nectar card holders applying for a loan will also benefit from double Nectar points on their shopping for two years^{(2) -} on their shopping in store, online and in petrol filling stations.

For example, customers who spend £50 a week with Sainsbury’s and have a Sainsbury’s personal loan as well as a Nectar card would receive £52 worth of Nectar points a year.

Sainsbury’s Finance is a joint venture between J. Sainsbury plc and Lloyds Banking Group.

⁽¹⁾ Independent Schools Council

⁽²⁾ Applicants will have to be Nectar card users and will have to supply their Nectar card number on applying for the loan