Members of the National Association of Graduate Teachers (NAGRAT) have received a major financial boost following the announcement of significant changes to the NAGRAT Fund Loan Policy.
According to an official memo issued by the National Secretariat and signed by General Secretary Ayuraboya Michael, the association has reviewed its loan scheme to make borrowing more affordable and repayment more flexible for members.
The new policy takes effect from 1st July 2026 and introduces four major changes that are expected to benefit teachers across the country.
Key Changes Under the New NAGRAT Loan Policy
1. Interest Rate Reduced from 12% to 10%
The biggest highlight of the review is the reduction of the interest rate on all NAGRAT loans from 12% to 10%.
Unlike some loan facilities that apply interest on the total original amount throughout the repayment period, NAGRAT’s revised policy uses the reducing balance method. This means interest is calculated on the outstanding balance rather than the initial loan amount.
What Does the Reducing Balance Method Mean?
Under the reducing balance method, the amount of interest a borrower pays gradually decreases as the loan balance reduces.
Practical Example 1
Suppose a teacher borrows GH₵20,000.
Old Interest Rate (12%)
- First-year interest: GH₵2,400
New Interest Rate (10%)
- First-year interest: GH₵2,000
This results in an immediate saving of:
GH₵2,400 – GH₵2,000 = GH₵400
As repayments continue and the outstanding balance reduces, the total savings become even more significant over the life of the loan.
Practical Example 2
Assume a member borrows GH₵40,000, the maximum amount under the revised policy.
At 12%:
- Annual interest = GH₵4,800
At 10%:
- Annual interest = GH₵4,000
Difference:
- GH₵800 savings in the first year alone
Since interest is charged on the reducing balance, members could save even more over several years depending on their repayment schedule.
2. Maximum Loan Amount Increased to GH₵40,000
NAGRAT has also increased the loan ceiling, allowing members to access up to GH₵40,000.
This enhancement provides greater financial support for members who may require larger amounts for:
- Home improvement projects
- Educational expenses
- Medical emergencies
- Business investments
- Family obligations
- Acquisition of assets
For instance, a teacher planning to renovate a house or support a child through tertiary education can now access more funds than before under the scheme.
3. Repayment Period Extended to Five Years
Another major relief for members is the extension of the maximum repayment period to five (5) years.
A longer repayment period generally translates into lower monthly deductions.
Illustration
Assume a member borrows GH₵30,000.
If repaid over 3 years:
- Repayment is spread across 36 months.
If repaid over 5 years:
- Repayment is spread across 60 months.
Because the repayment is spread over more months, the monthly deduction becomes smaller, making it easier for members to manage their finances while meeting other obligations.
This flexibility is especially beneficial for teachers who prefer lower monthly commitments.
4. Introduction of a Loan Top-Up Facility
For the first time, NAGRAT has introduced a Loan Top-Up Facility.
This allows members who already have an existing loan to apply for additional funds without necessarily waiting to complete repayment of the current facility.
Who Qualifies?
To qualify for a top-up loan, a member must have repaid at least 40% of the outstanding loan balance.
Example
Suppose a teacher took a loan of GH₵20,000.
To become eligible for a top-up facility, the member must have repaid an amount equivalent to at least 40% of the outstanding balance.
This new arrangement provides quick access to additional funds when unexpected financial needs arise, without requiring members to start a completely new loan cycle.
Why These Changes Matter
The revised NAGRAT Fund Loan Policy comes at a time when many teachers are seeking affordable sources of financing.
The reduction in interest rates means lower borrowing costs, while the increased loan ceiling gives members access to larger facilities. Additionally, the longer repayment period eases monthly financial pressure, and the introduction of the top-up facility provides greater flexibility for members facing urgent financial demands.
Collectively, these reforms are expected to improve access to credit and enhance the financial welfare of NAGRAT members nationwide.
Effective Date
All the reviewed policy measures will officially take effect on 1st July 2026.
Members seeking further clarification on the revised loan policy are encouraged to contact their regional offices or the NAGRAT Secretariat through the official channels provided in the memo.
Summary of the New NAGRAT Loan Policy
| Policy Area | Previous | New |
|---|---|---|
| Interest Rate | 12% | 10% |
| Interest Calculation | Reducing Balance | Reducing Balance |
| Maximum Loan Amount | Lower Cap | GH₵40,000 |
| Repayment Period | Shorter Period | Up to 5 Years |
| Loan Top-Up | Not Available | Available after repayment of 40% of outstanding balance |
The latest review represents one of the most significant improvements to the NAGRAT Fund Loan Scheme in recent years and is expected to bring substantial financial relief to members across Ghana.
Published By: Justice Donkoh | GESHub.org
