MULTIPLYING ACCESS
banking networks. There are some weird and wonderful pay-ment
methods in some countries around the world,” Simon
Read, vice president of education, EMEA at Flywire, says.
“In South Korea, for example, you can do an outbound
payment through an ATM machine.”
According to a recent Flywire survey of international stu-dents
in the UK, six out of 10 respondents found the process
of paying fees to universities “slow and painful”, with com-mon
issues that the company says can overlap with repaying
loans, including concerns about security, tracking payments
and unexpected charges.
Repayment terms can vary from five to 15 years or
more, according to Bryanna Davis, director at International
Student, which launched an online loan comparison tool for
international students in 2012 that allows them to compare
loan providers at the school they wish to attend. To date, it’s
been used over 1.1 million times.
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Adapting to local norms
Prodigy Finance, which says it has, in a little over 10 years
“disbursed almost $1 billion in student loans to over 19,000
students”, sees 80 per cent of its students coming from
emerging markets like India, China and Brazil.
“We’ve also seen students from countries such as Ca-meroon
and South Korea increasingly exploring internatio-nal
study,” notes Prodigy Finance COO Sarah Harvey.
Adapting to suit these markets is one of the advantages
alternative providers have over traditional lenders.
“We know that some students coming from emerging mar-kets
don’t have bank accounts, for instance, but we remove
the need for this by always disbursing the loan to the school
itself, who then keep the tuition and pass the cost of living
funds to the student once they arrive,” says Harvey.
“This significantly reduces the processes or admin that
students have to undertake to get their funds.”
Another way to support students in developing countries
without robust banking systems is to make it possible for
them to make everything from their phones.
“What tends to be the common denominator, especially
for Millennials or Gen-Z, is that they have a smartphone.
And so they might not have a physical address, they might
not have any assets or bank accounts, but they can access
the world through that device,” says Smadja.
“It takes about 30 seconds to figure out whether or not
they’re eligible, then after that, it takes 15 minutes for them
to do an application that would lead to a conditional offer.
We focus on about 360 universities in the US and Canada.”
Partnering with transfer services with a good local
understanding of popular payment methods ensures the
needs of people in diverse markets are being met. Flywire,
for example, works with several international student loan
providers and says it can facilitate students making loan
repayments in the way that suits them.
“There’s a whole host of different payment methods avai-lable.
It could be PayPal, Alipay or linking into local online
Providers are making the loan
application process doable by
smartphone to accommodate
those in emerging markets
PHOTO: TUBARONES PHOTOGRAPHY / PEXELS