GyanDhan, a Fintech facilitating education loan in India, has received an NBFC license from the banking regulator Reserve Bank of India to start disbursing credit as the country slowly recovers from the Covid-triggered crisis. Following the permit, the company aims to disburse $87 million worth of education loans in 2021-2022.
The credit would fund short-term domestic courses offered by various well-known ed-tech players and coaching institutes across the country.
GyanDhan, which offers interest-free education loans to students wanting to fund their higher education abroad and within the country, has already sanctioned loans worth $27 million for this ongoing fiscal year 2022.
“Till now, we have disbursed over $135 million in total. The NBFC license will allow us to design new loan solutions that meet the customers’ needs. We have extended loan offers to nearly 3,000 students in the last six months, partnering with more than 350 institutions in India. It is revolutionary in terms of its varied features like – instant loan approval, no-cost EMIs, disbursal in 24 hours, and the option to customize the loan product for the institute,” Ankit Mehra, Founder & CEO, GyanDhan, said.
The New Delhi-based company has realized that there are limited financing options for the students interested in pursuing short-term/vocational courses with the ongoing pandemic. Traditional lenders are reluctant to offer loans to such customers as they perceive them as high-risk products. But the demand for Edu-financing grew significantly aided by a boom in the ed-tech sector with a high fee structure.
With access to the partner’s internal data and alternative data, including understanding the course quality and final placements, GyanDhan can even approve customers with no credit history. The company believes that the data it is collecting will help it further refine its model, increasing access to funding options for more students in the future while also bringing down the cost for the end consumer.
The company has partnerships with leading financial players in India, including the State Bank of India, Bank of Baroda, Axis Bank, and ICICI Bank.