Neha, how can student finance loans create greater diversity in the higher education sectors?
Diversity plays a key role in the graduate school ecosystem, enriching the classroom and learning experience. It’s also a determining factor for universities when it comes to league tables and global rankings.
If you’re looking to study your postgraduate degrees overseas, away from your home country, it’s difficult to get a student loan. This is because traditional lenders are bound by local legal constraints, local data, as well as local repayments and collections, which ties an applicant’s credit profile to their location.
For example, if you’re born and live in the U.S., you’ll have a greater choice and access to financial services and credit. However, if you’re born in Africa or Latin America and want to study abroad, you’re more likely to be unbanked.
We’ve been addressing this issue, helping international students with limited or no funding options to gain access to life-changing educational opportunities.
One of our borrowers, Orgil Sedvanchig, told us: “Prodigy Finance was essential in financing my degree at Columbia Business School. It was the backbone to what I built financing around. In time, I would also like to return to Mongolia and apply the concepts that I learnt through an MBA to the developing frontier markets in South East Asia”.
Diversity is enabled when top talent makes it to top institutions, irrespective of their background, and country of origin.
Is it possible to create diversity by ethnicity and social background?
We believe it is, and our philosophy is that funding shouldn’t be a barrier to education – the best and brightest students should get to their university of choice. We’ve lent to students from over 130 countries, and this helps schools maintain diversity.
Do student loans only go to people looking to go into a narrow set of careers?
We started off working with universities on the Financial Times’ Global MBA Rankings. As we expanded our offering from business to non-business degrees, it was a natural fit to work with these same universities and reach out to their other faculties and schools.
Last year, we added 100 of the top U.S. universities and colleges, as ranked by U.S. News & World Report, to our list of supported schools.
We can now fund students in the field of business, engineering, law, public policy and health sciences. As Prodigy Finance grows, the set of careers that we can support is also expected to grow.
Do the students who qualify for loans already come from a more affluent background?
Not at all, we assess applicant loan affordability on numerous variables, including projected earnings and university acceptance, among others, rather than historical credit. All our loans are without collateral, a cosigner or guarantor. To date, more than 80% of our borrowers have had no alternative access to financing and come from emerging markets.
Can student finance help to achieve greater diversity in STEM-based careers?
Yes, student financing can help ethnic and social diversity in all fields of study, which increases the pool when these students graduate.
For example, if we take a look at the IIE’s statistics for the last U.S. academic year (2017/18), the country was host to 1.094 million international students, of which the most popular field of study was engineering, followed closely by business and management (engineering: 232,710 students; business and management: 196,054 students).
Unlike their business peers, we’ve found that postgraduate engineering students are generally younger, with less professional experience, and therefore have lower savings and a greater need for funding assistance. Our platform supports more than 220 specific engineering schools and 1,340 courses, including electrical and computer engineering, data analytics, information systems, and industrial, chemical and nuclear engineering, among others; with the option of 10, 15 or 20-year loans terms.
When it comes to gender diversity, companies are beginning to set targets which will increase the number of women in STEM positions – including management and skilled technical roles. In November last year, we awarded Veenah Venugopal with the inaugural Prodigy Finance Women in Tech ‘scholarship’. With an undergraduate degree in engineering, she’s pursuing her Master of Engineering Management to expand her skills in both engineering and business.
She said: “Today, respect isn’t in the cold hard cash. It’s in knowledge. And through this degree, I aspire to reach a position so high that people who discriminate against women will be forced to take a second look. Getting this scholarship supports my dreams and ambitions and helps me to facilitate the dreams of the next girl in line.”
An education, and the funding for that education enables dreams, small or large, and inspires the next generation of leaders.
About Prodigy Finance
Prodigy Finance was born in 2007 with the belief that attending a top university is a life-changing opportunity that should be available to all, regardless of background. The company’s Founder and CEO, Cameron Stevens, experienced this first hand with his MBA at INSEAD. Since then, Prodigy Finance has provided $736 million in funding to 14,500 students from 132 countries; the majority of which (89%) had no alternative access to funds.
The Prodigy Finance platform now supports 2,674 courses in 617 schools at 191 different universities, in the fields of business, engineering, law, public policy and, most recently, health sciences. Creating a new generation of diverse global leaders is so important as it is unlocking individuals potential anywhere across the globe and can transform entire communities.