To purchase devices, the Trust will need to secure finance/a loan for this purpose. This needs to occur before a commitment is made to purchase. To ensure that student devices arrive in New Zealand in time for the start of the school year,  device order numbers need to be confirmed with Cyclone by the preceding November.  The financing process works as follows :

  • Determine the options to finance the bulk purchase. These options may include :
    1. a loan through a financier
    2. a loan through a bank (the bank  may require a term deposit as security)
    3. a loan through a company or philanthropic trust
    4. a mix of the above. A portion of the bulk purchase may be able to be paid for upfront from existing cash reserves, with the outstanding amount being subject to the finance

  • Note the total cost of the bulk purchase is offset by the $40 deposit paid for by each parent.  For term one roll outs,  this deposit is ideally collected at the end of the preceding year so that funding is in place to offset the device purchase, and parents make a commitment.  Credit sale contracts may be completed by parents at this time, with Automatic Payments set up to commence once the device has been allocated.

  • Negotiate with a financier eg Equico, TRL or a bank, for the loan and interest rate required. Repayment is generally made over three years, to match the contract period for bulk of the parent repayments.

  • Your Trust will pay a portion of the cost directly to Cyclone or the financier (depending on what is arranged at time of order) upon receipt of the devices - financed by parents paying their $40 deposit. As discussed above, this reduces the overall loan.  The $40 will have been typically receipted by each school, which means that the Trust will then invoice each school for the correct amount ($40 x number of devices for that school)

  • Parents enter into credit sale contracts with the Trust. Around 5% may choose to pay in full up front, which can also be useful in creating a small cashflow for the Trust.

  • The purpose of the equity amount (recommended to be 20 percent of the total loan) is in order to provide evidence to the financier of the Trust’s financial resources, as well as to provide some protection for trustees against payment failure by some families.