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A disbursement is the payment of federal student aid funds to the student by the school.

Disbursements at the University of Otago

You will receive two equal disbursements of the year, normally in March and July for students starting their study at the beginning of the standard academic year. The disbursements usually take place the week after the last day to delete papers for that semester, and there are a couple of requirements you need to fulfil before the initial disbursement at the University of Otago.

All disbursements are subject to the following conditions:

  • You need to be enrolled at least half-time.
  • You need to make satisfactory academic progress.
  • You must complete no more than 25 per cent of your course from outside of New Zealand.
  • You must not have violated any part of the regulatory framework regarding compliance (defaulted on previous loans, fraud, drug conviction, etc).

First semester disbursement of funds

The first disbursement of funds usually takes place within one week from the last day to delete papers. The Financial Aid Administrator will check that you continue to meet the student loan eligibility requirements and then will email you to confirm your loans, so keep an eye out for this email.

Make sure you have opened a New Zealand bank account and added this information into eVision.

When you confirm your loan, the Financial Aid Administrator will create the loan in the US Department of Education's Common Origination and Disbursement (COD) website. Once this is complete, we will inform the University of Otago's Revenue Management Office (Student Finance) of this disbursement and they will draw down the loan from G5, the US Treasury Account.

When the loan has been received, the loan is converted into New Zealand Dollars and then credited to your student account. Please note that your loans will be used to settle half of your Otago fees (tuition, student services and insurance fees) for the year, and then any remaining balance (credit balance) will then be transferred into your selected New Zealand bank account for living costs.

If your financial aid does not cover your tuition fees, you will be advised.

The process of authorising the drawing down of your loans until they can be accessed by Student Finance can take approximately six working days, primarily the result of US Department of Education regulations and the University's processes for handling payments in foreign currency (the funds are disbursed in United States Dollars).

Unless a student or parent (in the case of a parent PLUS loan) authorises a school to hold a credit balance, the credit balance must be paid to the student or parent as soon as possible but no later than 14 calendar days after the balance is created.

Have back-up funds available to cover the first 2–3 months in case of unexpected delays in fund disbursements and as a buffer for initial costs (e.g. tickets for orientation week events, set up costs on arrival).

Please be advised that funds will not be disbursed to foreign bank accounts.

During your studies

You need to make sure you discuss any planned changes in your enrolment with the Financial Aid Administrator before you make the change to ensure it will not impact your loan.

It may be possible to adjust the amount of loans during the semester.

Second semester disbursement of funds

The second disbursement of funds usually takes place the within one week from the last day to delete papers. You will again receive information about upcoming disbursements from the Financial Aid Administrator by email.

This second disbursement for the year will settle the remaining Otago fees and any remaining balance will be transferred into your New Zealand selected bank account for living costs.

Remember to continue to be eligible you need to continue to meet our US Loan satisfactory academic progress (SAP) policy:

About the Satisfactory Academic Progress Policy (PDF)

Loan fees

Loan fees are charged by the US Department of Education to originate a student loan and are calculated as a percentage of the total loan amount. The loan fee is subtracted directly from the loan before it is disbursed to you. This means you will receive a smaller loan that the total amount you accepted, but you are still responsible for repaying the entire amount you borrowed.

Learn more about loan fees on the US Government's Federal Student Aid website:

Fees for Federal Student Loans – Federal Student Aid

Exchange rates

You need to be mindful of how the current exchange rate fluctuation may affect funds received. Direct Loans are originated in United States Dollars (USD). Your disbursements will be converted from USD to New Zealand Dollars using the effective exchange rate on the day of delivery.

Revisions cannot be made to reflect any changes in the currency exchange rate.

Loan enquiries

Financial Aid Administrator
International Office
Ground Floor, Clocktower Building
90 Union Place East

We recommend that you contact us to make an appointment so that we can ensure the administrator will be available to see you.

Tel +64 3 479 8582

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