Customers do not require a social security number or local credit history to be eligible, but they must be graduates of master’s degree from a list of more than 280 universities across 20 countries, and reside in the UK or US. The option will be open to working graduates on any available visa category, Prodigy said.
“The financial services industry needs to accommodate international talent mobility”
“Our goal is to provide the best loan product to each individual borrower, depending on their preferences and needs,” Ricardo Fernandez, Prodigy Finance’s head of refinance, said.
Compared with their domestic counterparts, international working graduates are disadvantaged due to few “fair and competitive” refinancing options, according to Cameron Stevens, founder and CEO of Prodigy Finance.
Traditional lenders are unable to assess cross-border risk, according to the firm, meaning international students often have to accept loans with high interest rates or provide collateral, or seek multiple loans from different lenders.
Refinance is the next “logical step”, Stevens added, as the company has “focused on democratising education” by addressing the fees gap that international students face for more than a decade.
“The opportunity to study is a life-changing experience for many, however upon graduation, the reality is that paying off a student loan is a sizeable commitment,” he noted.
The firm has already refinanced US$10 million in loans for international working graduates in its pilot phase.
Prodigy Finance is adding new locations to its operation monthly, according to Fernandez, and its objective is to reach every US states in the next six to 24 months. Alternative providers, such as Stilt, offer refinancing products in 14 countries, while MPower Financing offers its refinancing tool across the US.
“Prodigy Finance’s mission is to remove the barriers associated with funding education,” Fernandez noted.
“We believe the financial services industry needs to accommodate international talent mobility and the global economy better, and look forward to helping international working graduates in the same way we’ve been helping international students.”
A spokesperson from Stilt said that its clients save over $12,000 over the lifetime of their loans with its refinancing. As the company increases the loan size in the near future, its expects customers to save up to $30,000.
Additionally, as Stilt scales the company, it will start serving graduates working in countries other than the US, they stated.
“Refinancing products [like these] will ultimately save you money,” said Michael Davis, chief investing officer at MPOWER Financing – a company that offers tuition loans to international students across the US.
What Prodigy Finance is offering, is really admirable, Davis told The PIE News.
How much customers will save depends on where the students received their original loans. Students from Brazil can be paying up to 36%APR on their student loans so they would appreciate great savings by refinancing their original in-school loans, Davis added.
“These borrowers work all over the place; they are global citizens. There are two benefits to these refinancing products. First you save money, but it’s also a way to build credit.”