Many students and their families worldwide are unable to afford a post-secondary education. Often, the average cost of education exceeds median household income. Furthermore, options for financing education are limited. Due to these factors, many students lack access education.
Scholarships and loans are grossly insufficient to support tuition expenditures in most countries. Students with access to financial aid have a higher probability of attending university. The university educated are significantly more likely to attain full-time employment after graduation with a significant wage premium providing for improved quality of life. Higher education often provides a multi-generational benefit, as children of educated parents are more likely to be educated (ie. in Mexico, students with college educated parents have a 78.3% likelihood of attaining a bachelor’s degree, vs. 7.8% for children with less educated parents).
Financial institutions are not set up to manage student loan programs and, if they are offered, are often costly due to their inefficiency requiring long lines, paper applications and decision times that take weeks or months. However, millennial customers are the future of any retail bank and student loans offer an incredible customer acquisition channel.
With Quotanda’s Lending as a Service (LaaS) platform, financial institutions don’t need to invest in developing new technology or the additional overhead cost to set-up and manage a student financing programs. Banks cannot keep up with fast-moving technology developments across verticals and Quotanda provides a comprehensive solution for lenders.
Foundations can use Quotanda’s platform to manage automated scholarship applications and reporting. In addition, foundations can offer their own student loan programs, which can achieve target returns while fulfilling their mission of helping students access education. With revolving loan funds the same capital can be used to help many more students than scholarships alone.
Governments can now use Quotanda to provide scholarships and loans to students in key development areas (ie. focusing on 1st generation university students etc.). Government student financing options are increasingly popular, as can be seen in the UK, Netherlands, Luxembourg, Denmark, etc.
In many countries, schools (including universities) don’t have access to student financing options despite additional capacity in classrooms. Offering student financing solutions, even in the form of extended payment plans for students that would otherwise be unable to attend, can expand access to education and increase revenue. While many schools manage financing programs internally, often on spreadsheets, professionally managed student financing programs are typically more profitable and allow university administrators to focus on education.
Research from the World Bank shows graduation rates can often double when student financing options are broadly available. Quotanda’s fintech platform allows schools, banks, foundations and governments to quickly launch and to efficiently manage student financing programs without additional overhead costs.
Education is directly related with economic and development progress, increasing access to education and increasing opportunities to students from all socioeconomic levels has huge benefits to society as a whole.
With Quotanda’s technology, Financial Institutions, Schools, Foundations and Governments can set up student financing programs and help us democratize access to education worldwide. The objective of this research has been to prove the need of this technology and the value of its broad application worldwide.
The main objective from this research is to prove the Lending as a Service business model and various applications of this technology. Through the research Quotanda has found an increasing interest from 1) Banks who want to digitalize lending products to appeal to a younger customer base, 2) Schools (including universities) worldwide as well as new skill training programs (ie. code bootcamps), 3) Governments which are lending or interested in lending at at regional or national level, and 4) Foundations that are interested in new tools for expanding their social impact.
