CAIRO: A $39 million portfolio to provide Egyptians with student loans is currently pending approval from the International Finance Corporation (IFC), the private sector arm of the World Bank Group.
According to the IFC website, the new facility targets Egyptian students applying to undergraduate and graduate programs at private universities in the country.
The loans will have a maturity date of up to eight years after graduation.
Since the proposed project is still in the early stages, the IFC could not confirm the expected timeframe or the number of students that would benefit from it.
IFC will team up with Al-Noor Magrabi Foundation, the Sawiris Foundation for Social Development and Al-Alfi Foundation on the student loan program.
The proposed IFC investment is a risk-sharing facility with Credit Agricole Egypt. IFC will share senior risk on the portfolio of a maximum $17 million, while the funding will be originated and managed by Credit Agricole Egypt.
Credit Agricole Egypt could not be reached for comment.
The project was inspired by “the belief in the role of education in building the human personality, [the desire] to expand opportunities and choices in life and [the belief] quality education is the real engine of community development, the Sawiris Foundation said in a statement to Daily News Egypt.
“[The project] is expected to be launched in summer 2009 after an assessment of the loan program and its components, characteristics, and design to participate in the arrangements between the various parties, and to develop criteria for the granting of loans and the preparation of marketing brochures for the program as well as for the preparation of all legal documents of its own, read the statement.
The program is expected to allow Egyptian students who otherwise could not afford to enroll in private universities the chance to study at these institutions.
Egypt’s gross national income per capita is $1,580 (around LE 8,960), according to a World Bank report, while the average tuition at private universities is around $10,000 (LE 55,000).
Several commercial banks in Egypt offers student loans, however, the monthly installments are not affordable to the average Egyptian student, particularly given the low salaries many employees receive.
At the same time, not all universities offer student loans.
According to Samia El-Shazly, director of student financial affairs at the American University in Cairo (AUC), “We don’t provide loans to students but other services are provided to help students get access to AUC, El-Shazly told Daily News Egypt in a telephone interview.
However, there are different scholarships offered. For example, students whose GPAs put them in the top 25 percentile receive a 30 percent deduction off tuition; those who display financial need get a 35 percent deduction, and those with outstanding achievements in cultural or sports are eligible for a 15 percent deduction, according to Nawal Aboul Ela Ahmed, assistant director of the student financial affairs office at AUC.