As the global markets open after the pandemic, more and more Indian students now aim to fulfil their ambitions to study abroad. Global fintech platform Prodigy Finance which offers loans to students wanting to seek higher education in foreign countries has raised $750 Mn funding from CPP Investments. It said that the investment will further help it expand its operation in India where it is witnessing 50% (year-on-year) rise in terms of student applications.
The UK-based finance platform said that millions of Indians go abroad every year for higher education which require a heavy amount of funds for both tuition and living expenses. Founded in 2008, Prodigy Finance claims to offer education loans to Indian students without the need for security, a co-signer or guarantor at more than 800 schools around the world, in the fields of marketing and business administration, engineering, law, public policy and health sciences.
Prodigy Finance has till date has funded over $1 Bn in graduate education loans to more than 20,000 students from over 100 countries including India.
“We are pleased to have secured this substantial infusion of funds. We are confident that this funding will prove instrumental in transforming the future of numerous deserving students across the Indian subcontinent who, otherwise, would never have been able to follow their dreams of studying in a top foreign university,” said Mayank Sharma who is the country head for Prodigy Finance India.
Prodigy Finance will utilise upto $500 Mn of the raised capital for financing of deserving students through its subsidiary CPPIB Credit Investments Inc.
The latest investment comes on top of a $250 Mn facility Prodigy Finance agreed last year with America’s development bank, the US International Development Finance Corporation (DFC). These DFC funds will be used to grant loans to postgraduate students with a primary focus on low-income and lower-middle-income countries (minimum 50%) and women (minimum 30%).
Indian students hold the second spot when it comes to going abroad for higher studies, followed by Chinese students. As per the Ministry of External Affairs (MEA), in 2018, around 7.5 Lakh Indian students went abroad for further studies. Even in a pandemic-hit year, as per the MEA, around 71.7 K students left India for higher education in the first two months of 2021. According to a Leverage Edu report, around 94% of Indians still want to study abroad even in the backdrop of the pandemic. The report highlighted that around 71% of Indian students chose foreign countries for higher education because of a better healthcare infrastructure.
With increasing Indians opting to go abroad, several startups are emerging who are facilitating loans to these students. San Francisco and Bengaluru headquartered Leap earlier this month bagged $55 Mn by Owl Ventures to help more Indian students go abroad. Last month, Eduvanz, another education loan provider, raised INR 100 Cr in a Series B round led by JuvoVentures, Sequoia Capital and Unitus Ventures, among others.