Fintech startup Edstart launches platform to help parents pay for private school fees
Fintech startup Edstart launched a new lending platform last week to help Australian parents manage the cost of private school fees.
The private school market is the first of many education sectors the company is looking to target, offering low-cost, customised loan packages to make paying education fees simple and easy.
The loans help parents to spread out the cost of school fees over the period of tuition and beyond, allowing 6 years of high school to be paid over 10 years or more.
Co-Founder and CEO Jack Stevens said the company’s focus from day one has been on solving for customer pain points.
“Over 35% of all Australian K-12 students currently attend a fee-paying school and there are a huge number of parents right now who are dreading their next school fee bill. We want to take away that pain by providing them with the simplicity of a long-term payment plan.”
“These families are making a significant investment in their children and we believe there is a clear need in the market for a financing solution to support this.”
While the Edstart platform can be accessed directly by parents, the company has also received significant interest from private schools looking to offer alternative fee payment options to families.
“There has been interest from schools across the board from top tier independent schools in Sydney and Melbourne, right through to lower-fee Catholic schools. Boarding schools have found the proposition particularly attractive given boarders can pay up to double the fees of day students.”
Edstart has partnered with RateSetter, a global leader in peer-to-peer lending to provide the consumer loans during the company’s launch phase this year.
RateSetter have been operating in Australia since 2014 and have lent over $48 million to Australian borrowers during that time. Their innovative technology platform means borrowers can get access to lower interest rates and faster decision times as compared to banks and other traditional lenders.
Mr Stevens said it was these qualities which made RateSetter an attractive partner for providing loan funding.
“The RateSetter team have developed an outstanding customer experience for borrowers, which gives us comfort in partnering with them to provide finance for our customers.”
Edstart also has the backing of H2 Ventures, a leading fintech venture capital firm, who provided funding to the company in February 2016 as part of the H2 Accelerator program. The funding deal included office space at Stone & Chalk, the Sydney-based financial technology hub which now houses over 75 businesses looking to transform the financial services sector.