Absa Loans for Pensioners

Are you a pensioner in South Africa? Are you wondering about Absa loans for pensioners? Does the bank provide loans to people on retirement? Absa is, without doubt one of the biggest banks in South Africa. They offer a wide range of products, including loans. One of the requirements is that you need to provide a payslip or proof of income before you can get a loan. So, where do pensioners stand in this regard?

Does Absa provide loans to pensioners?

Absa does provide loans for pensioners. However, each of the cases will be looked at individually. Whether you get money and how much you will get depends on the type of pension that you have.

Types of pensions

That’s the answer for those looking for information about Absa loans for pensioners. In South Africa, there are four types of pension funds;

  • Pension funds: These are provided as part of your employment. In most instances, your contribution will be split between you and your employer. Your part will be deducted from your salary on a monthly basis. If you have this type of pension, then you will qualify for an Absa loan. The amount that you get depends on you monthly payout. Should you be retrenched or dismissed, you will be able to get your contribution back.
  • Provident funds: Like pension funds, provident funds are only available to people in formal employment. Your employer pays your contribution to the fund every month. In some countries, provident funds are government managed. With a provident fund employees do not have to pay their contributions directly.
  • Preservation fund: This type of fund is usually set up when a fund is dissolved. Let’s say you have been contributing to your pension, but the fund closes for one reason or the other. In that case, your contribution will be moved to a preservation fund. Money will also be moved into such a fund in the event that you have terminated your employment at a company before reaching retirement age.
  • Retirement Annuity: This type of pension is set up by an individual and not by their company. It’s not part of your employment. So, you will be responsible for keeping up monthly contributions. You should invest in one if your employer does not not have either a provident fund or a pension fund.

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Summary

In this article, we focused on the issue of Absa loans for pensioners. We noted that pensioners can take out loans from Absa. That is, however, dependent on the nature and type of pension that you have. It also depends on the amount of money that you are getting from your pension on a monthly basis.

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