How Edtech Skill-Lync Pushed Students Into A Debt Trap With False Promises

How Edtech Skill-Lync Pushed Students Into A Debt Trap With False Promises


Chennai-headquartered Skill-Lync, founded by SuryaNarayanan PaneerSelvam and Sarangarajan V Iyengar in 2018, is witnessing itself standing at a crossroads of many controversies

Many Skill-Lync students have alleged that the edtech made them take loans by showcasing them as salaried employees with various companies, which as per the students don’t even exist

Students from various states and cities are in the process of filing cheating and fraud cases against the startup

Even though India produces around 15 Lakh engineering graduates every year, there is a huge gap in the skills they possess versus what the job market demands. According to a study by Scaler, an upskilling platform, only 2.5 Lakh engineering graduates (or 16%) land relevant jobs every year.

A lack of close collaboration between India Inc and academia has created a huge demand in the market to upskill fresh out-of-college engineers in the constantly-evolving age of new-age technologies like artificial intelligence (AI), machine learning, etc.

It is on the back of this red-hot market that several big edtech companies have been able to raise millions of dollars to make fresh graduates job-ready and upskill working professionals. On the flip side, recently, many bad actors have been accused of exploiting this lucrative space, and continue to get exposed every now and then.

Chennai-headquartered Skill-Lync, founded by SuryaNarayanan PaneerSelvam and Sarangarajan V Iyengar in 2018, is witnessing itself standing at a crossroads of many controversies from employee layoffs to now students levelling serious allegations against the edtech startup.

Since its inception, the Y Combinator, Better Capital and Iron Pillar-backed startup has raised more than $20 Mn in multiple funding rounds. Its playbook is simple — tap into the growing upskilling market by offering advanced PG-level courses to young engineering graduates and make them job ready.

Indeed a noble idea, however, the company may have walked too far with its playbook when it started to guarantee jobs and internships to its students. Now, amid an uproar by students that Skill-Lync has faltered to deliver, it could be looking at multiple lawsuits from its customers for allegedly duping them of lakhs of rupees on the pretext of giving jobs and allegedly tricking them into taking loans.

This is not it — many serious allegations have been slapped by students, both former and current, on Skill-Lync’s modus operandi and the authenticity of the student data that the company shares with its lending partners to avail loans.

Before we delve into the series of allegations, it is vital to highlight that the edtech is on a cost-cutting spree and has axed more than 600 employees so far this year.

Is It Really Raining Jobs At Skill-Lync?

More than a dozen former and current Skill-Lync students that Inc42 spoke with have alleged that Skill-Lync made them take loans by showcasing them as salaried employees with various companies, which as per the students, don’t even exist.

These students told us that their job details and salary information, which reflect in their loan documents allegedly submitted by Skill-Lync to its partner lenders, are all fake.

Inc42 has access to various materials, including student data provided to a lender, showcasing them as working professionals instead of students.

What’s even more surprising is that one of these students works for a company, ‘student’, for an annual salary of INR 1.9 Lakh. (Images for reference below)

As we dug deeper, we met a 24-year-old Skill-Lync student, Mohit (name changed upon request), who showed us his details on the website of lender Eduvanz, which states that he has been working with a company, for more than two years and was drawing an annual salary of INR 3,48,000.

Skill-Lync, Eduvanz — student loans

An unemployed Mohit who had completed his course in Data Analytics last year, told us that his mind was boggled, and he got pushed into a state of mental turmoil before he could finally digest that Skill-Lync made him take a loan by showcasing him as a salaried employee, at least what his loan documents show.

“Typically, these aren’t educational loans under which students are expected to pay after the completion of the course. These rather seem to be personal loans where the salaries of the borrowers act as collateral. In education loans, banks or NBFCs ask for the repayment of loans, along with interest, only after the completion of their courses, and even give students an extension in many cases,” a Bengaluru-based banking professional said, requesting anonymity.

Meanwhile, a former Skill-Lync student from Chennai shared an audio recording with us in which a Skill-Lync employee can be heard using ‘job guarantee’ as bait to divulge the details of his bank account for the loan application. “One year on, there is no job, and the employee has left the company too,” the student said.

Inc42 did not receive a satisfactory answer from the CEO and cofounder of Skill-Lync, PaneerSelvam, when we asked if the company’s finance team showcased students as working professionals to avail loans.

“The loan transaction/EMI for enrolment in our course emerges from an “Agreement” which is entered between the student and the Lending Institution, and Skill-Lync is not privy to the contract,” the Skill-Lync CEO said.

If this is the case then why an employee of the company’s finance team can be clearly heard requesting bank details of a student for the loan application in a call recording shared with us.

“The loan is an “OPTION” provided to students who intend to pursue the course but do not have the means to pay the course fee. In such a case, such students are connected to third-party lenders. It is made clear that Skill-Lync is not the lender here. Upon confirmation from the students through Aadhar verification, OTP verification or e-signatures, the loan application is processed and approved,” said the CEO.

On the contrary, students whom we spoke with said that more than 50% of them, who registered with a nominal fee of INR 5,000, were not even informed that the monthly payments they were making as course fees were rather the EMIs they were paying for the loan taken on their behalf.

“We were put under the impression that the course fee is divided into EMIs. For this, the Skill-Lync finance team took our bank details, and bank statements, along with Aadhar and PAN card details. When we questioned, the officials told us that the details were being taken to ensure that students do not falter in making payments post the completion of their courses. Soon, we were left scratching our heads when we got a message from Eduvanz that our loan application has been accepted,” said the students who are accusing the company of showing them as employees of fake companies.

Moving on, our quest to get to the crux of the matter took us to many more students, who too alleged that the company made them fall prey to its questionable practices.

Several students have alleged being tricked into taking loans, ‘probably personal’, from various lenders, including Eduvanz. Interestingly, all these students have one thing in common — they are all employed but only in their loan documents.

“We don’t even know if the companies where we are shown to be working exist or not. Even the NBFCs or lending partners that closely work with Skill-Lync have failed on multiple fronts while conducting due diligence,” another aggrieved student said.

Note: Our multiple attempts to reach out to Skill-Lync’s lending partners, including the Eduvanz CEO, failed to yield any result. The story will be updated accordingly once they respond.

Notably, Skill-Lync’s saga has a striking resemblance with another upskilling startup, GreekLurn, whose CEO Kamalapuram Srinivas Kalyan was arrested by the Bengaluru police in June this year for allegedly defrauding at least 2,000 students by availing loans in their names.

Students Prepare To Lock Horns With Skill-Lync

At the core of the issue is Skill-Lync’s strategy to target students from middle to low-income households, who are looking to upskill themselves to land suitable job roles.

As of now, the company is being cornered by its students for failing to provide jobs, with many debt-laden individuals in the process of lodging a complaint with the Chennai Police against Skill-Lync for defrauding them under the pretext of providing jobs after the completion of their courses.

Sources close to the development told Inc42 that a group of students is expected to meet Chennai police and file a complaint against the company for duping them, in connivance with an education-focussed NBFC, Eduvanz.

As seen by Inc42, a complaint letter from one of the students at Skill-Lync, addressed to the Chennai Police director, accuses Skill-Lync and Mumbai-based Eduvanz of coercing the student (name withheld upon request) into taking a loan to pursue a PG-level certificate course in car designing.

The student had first enrolled in the course and took a loan from the edtech’s partner NBFC, however, later the complainant’s mind changed and he wanted an exit but couldn’t. Inc42 has a copy of the letter.

“I found the course material and the videos on the platform substandard after I got registered on the platform. Therefore, I changed my mind and asked the company to cancel my candidature. Despite multiple attempts to reach out to the company, all my requests have fallen on deaf ears. I am unable to cancel the registration of the course, and the lender (Eduvanz) continues to raise EMIs,” the complainant told Inc42.

“But for exigencies like medical grounds, there is no prohibition for the enrolled students to opt for course cancellations at any point. The cases of cancellations are dealt with on a case-to-case basis and merits,” the company said in an email response.

What Does Skill-Lync Promise?

After speaking with several students who claim to have completed their courses last year and are yet to get jobs, we decided to take a look at the agreement that the edtech signs with students, along with how it promotes itself.

A recent contract agreement states that for securing a job/placement, students must meet certain terms and conditions. If students are unable to get a job in 180 days even after meeting the terms and conditions, they will be refunded in full.

However, more than a dozen students we spoke with claimed that they have been sitting jobless since last year after completing their courses, the duration of these varied between three and nine months.

Notably, under the terms and conditions in its agreement, Skill-Lync mentions that students will have to appear for various mock interviews and tests, and score a certain percentile during their courses to land a job.

Meanwhile, on the promotional front, Skill-Lync via email marketing promise jobs or money back if students pursue courses in data sciences and analytics.

Interestingly, the internet has many media reports that acknowledge Skill-Lync as an edtech that either guarantees a job or refunds money.

However, it is quite unclear if the edtech changed its strategy later and included multiple competencies to be eligible for a job, even after completing the course.

Explaining Skill-Lync’s side, the CEO told Inc42 that the company has replaced its job guarantee programme with a job assistance programme, which refrains from giving guarantees.

“It is crucial to note that the non-refundable nature of all courses, except for the 25% with a job guarantee, is explicitly communicated during the enrolment process and has been clearly mentioned in the terms and conditions on our website,” PaneerSelvam said.

Meanwhile, students have alleged that the company had to change its policy after it failed to deliver its promise to give jobs.

One of the students who completed a PG programme in Data Analytics and Data Science, which came with a job guarantee, has been waiting to get a job for the past 11 months. Inc42 was given access to an emailed communication from Skill-Lync’s team to this student.

Skill-Lync was also sending out promotional emails to students guaranteeing jobs for courses like PG in Electric Vehicle Design and Development until last year.

Skill-Lync Ad


Even as Skill-Lync may have moved to a more sensible approach now of not guaranteeing jobs to all the students enrolled, however luring the fresh college students with promises as above and finally not meeting these terms and conditions has backfired for the edtech platform.

Moving on, Skill-Lync charges anywhere between INR 2.5 Lakh and INR 3.5 Lakh for its courses that may stretch anywhere between three and nine months. To make it easy for students to pay the fee, the company has partnered with NBFCs such as Liquiloans, Eduvanz, etc.

Various students told us that the company promised to offer paid internships, with a stipend of INR 10,000 per month, within the first three months of starting their courses so that they could start paying their course fees.

“While some students got lucky, a majority fell prey to the company’s forked tongue,” a student said.

Meanwhile, he said that some students, who approached the director of Chennai police with a plaint, were called by Skill-Lync officials and were directed by them to stay away from raising the issue on social media platforms, including WhatsApp groups, if they wanted refunds.

“Our Maharashtra and Tamil Nadu Chapters are already in the process of approaching the authorities under various sections of cheating and fraud against Skill-Lync,” a student said.

A Flawed Business Model?

The Skill-Lync saga is unravelling at a time when the Indian edtech industry is fraught with the challenges of market overestimation, a decline in users and a pent-up demand for offline learning.

This perhaps explains why many edtech giants, including BYJU’S and Unacademy, are cutting or have cut costs massively.

In Skill-Lync’s case, the edtech promises zero-interest EMIs to students, under which the interest is to be paid by the edtech and the loan amount is borne by students.

On its website, one of Skill-Lync’s partner NBFCs, Eduvanz, mentions that it charges an interest rate of 15-45%, which is to be borne by edtech platforms.

When we asked the Skill-Lync CEO about the edtech’s main revenue streams, PaneerSelvam said that it was the company’s internal matter.

In another question, we requested the CEO to talk about the edtech’s financial performance in FY23 and how it plans to walk on the profitability path, especially when he was recently quoted proclaiming that the startup was on track to achieve operational profitability by Q4 2023.

While PaneerSelvam refrained from divulging details on the company’s FY23 financial performance, his strategy to make the startup profitable is by “providing stellar services and responsible entrepreneurship.”

At a time when the company’s confidentiality clause restricts the CEO from giving insights into how the company performed during FY23, it becomes imperative to highlight that Skill-Lync’s FY22 loss bloated 6X year-on-year (YoY) to INR 140 Cr. Its revenue from operations in FY22 rose 3X to INR 46.7 Cr from INR 15.9 Cr in FY21.

Interestingly, another part of the edtech’s strategy to generate revenue was to take a 10-15% share of students’ income once they get placed after completing the course.

One year after the inception of the edtech, CEO PaneerSelvam said that the monetisation will come from students who will share 15% of their salaries with the company for at least two years.

However, the model hardly seems to have worked given that a majority of students allege sitting jobless even after completing their courses.

Further, the edtech’s decision to lay off 600 employees and shut its offices in Hyderabad and Bengaluru (as per sources) to cut costs and increase its runway has done more harm than good. According to the students that Inc42 spoke with, this has had a negative impact on the quality of the courses and many students now want to drop out.

“There are practically no teachers. Even more frustrating is the fact that there is no one to attend to our cancellation requests,” said a student, who is leading a group of former Skill-Lync candidates in Chennai. Let us reiterate that the company “does not have any cancellation/refund policy”.

The student added that since many employees have been fired, students aren’t sure if the company will be able to complete the tenure of their courses, let alone job ‘assistance’.

Skill-Lync’s CEO has rubbished the allegations by stating that the edtech has a team of 60 full-time teachers who teach over 2,000 students every week.

Students Under A Pile Of Debt 

Despite Skill-Lync’s claims of making the next generation of Indian engineers job ready, the reality is that many fresh-out-of-college engineers have only been tricked into taking loans and are now struggling to pay off the debt in the absence of guaranteed jobs.

While many students have alleged that they have failed to find a job even after completing their course, others are facing continuous harassment from loan agencies and recovery agents for failing to pay EMIs.

“One of the partner NBFCs has threatened legal action against me because of my four pending EMIs,” a student said, requesting anonymity.

Can An Edtech Policy Resolve Such Gaps?

At a time when the Indian edtech sector is stuck between a rock and a hard place to curtail the rise of bad apples in the space, many sectoral experts want the government to weave a fool-proof edtech policy.

Speaking with Inc42, an industry analyst said that under the Reserve Bank of India’s (RBI’s) guidelines, partner lenders are required to conduct due diligence on educational institutes and edtech platforms, the courses they offer, and the associated fee structure before agreeing to disburse loans.

“Unfortunately, we have seen many cases of predatory lending in the edtech space since the pandemic, and this is giving the industry a bad name,” the analyst said, requesting anonymity.

Given that more and more instances of allegations and frauds are coming to the fore in the industry, the blame lies on lenders too, the expert added.

What is more concerning is that the industry has time and again urged the government to regulate the sector, but little has been done so far.

In 2021, the Indian government issued an advisory to the edtech companies and notified them that such firms will fall under the Consumer Protection (e-commerce ) Rules, 2020, but this has not been able to achieve the objective of streamlining the sector like in the case of the fintech industry.

After the government’s intervention, leading edtech companies like BYJU’S, Unacademy, upGrad, and Vedantu got together in 2022 to form an Indian Edtech Consortium for self-regulating the industry.

Ironically, some of the member companies in the consortium have also faced allegations of unethical practices. It is due to such instances that the sector today demands the Centre and state governments to come together in the best interest of students, and formulate regulations that can keep any instances of future fraud or even aberration at bay.

[Edited by Shishir Parasher]

Note: We at Inc42 take our ethics very seriously. More information about it can be found here.

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