Private student finance firm Prodigy Finance has raised US$1bn in the past year, which CEO Cameron Stevens said will allow even more students “with limited or no funding” to take part in mobile study.
The firm says traditional lenders are out of date, and its new credit model will improve global access.
“Our global credit model has allowed us to help international students with limited funding options”
The new funding comes from debt financing – the process of “lenders or institutional investors providing for revolving credit loans, term loans, receivables financing… or issuances of debt securities”.
Investors include global financiers and investment banking institutions such as Deutsche Bank, Goldman Sachs, M&G Investments and Sumitomo Mitsui Banking Corporation. Smaller investors are reported to have taken advantage of Prodigy’s international bond program with Credit Suisse.
The company’s business model assesses applicants and their potential loan through projected earnings and the level and institution they will study at, rather than the accepted traditional model of basing credit on personal and financial histories.
“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. Our global credit model has allowed us to help international students with limited or no funding options to gain access to life-changing opportunities and become the next generation of leaders around the world,” Stevens said in a statement.
The upshot of the new financial backing is an extension of the company’s activities, in particular a focus on engineering students at US HEIs, according to reports.
