Australian fintech ZeeFi has introduced a new kind of Buy Now Pay Later (BNPL) technology, one that exclusively serves the educational sector.
The fintech has developed a new ‘Study Now Pay Later (SNPL)’ form of paytech that allows students to finance their education in very much the same way that the technology is typically used across e-commerce.
SNPL has been purpose-built to remove the financial barriers that stand between education providers and students who want to study but are unsure of how to finance their learning.
Available for courses valued between $500 to $20,000, SNPL allows providers to get paid upfront, while students spread their course cost, interest-free, with regular repayments for up to 36 months. This means increased cash flow for providers while students receive stress-free funding with high acceptance rates.
When approved, ZeeFi onboards the student and manages the payment process.
Harnessing its experience of providing loans for vocational and higher education and leveraging the data gained from its outsourced management of instalment payment plans for vocational education providers, ZeeFi CEO, Adam Olding, said the startup was perfectly placed to tear down the financial barriers that impeded both education providers and students in reaching their potential.
“We have a deep understanding of the sector’s nuances. From payment compliance; to insights on student characteristics; to creating unique credit scorecards using our data analytics.
“We have high acceptance rates but if for whatever reason, a student isn’t accepted for Study Now Pay Later, we can automatically convert them to an interest-free payment plan that we manage for the education provider on an outsourced basis, so they can be guaranteed enrolment.
“It’s a holistic solution for the industry challenge to maximise enrolments and enables education providers to onboard more students than traditional BNPL products,” he said.
Olding goes on to explain how the pandemic demonstrated how online learning could move quickly, well beyond traditional programmes of education and training.
In fact, Covid-19 accelerated the popularity of online, short, and vocational courses offered by private providers, Registered Training Organisations (RTOs), and universities, as people sought to upskill or reskill in the changing job market.
And with the global online learning market forecast to grow from $130billion to more than $470billion by 2026, Olding explains how Australia’s education sector was simply not keeping up with the fast-moving changes on the funding front.
“If you select a non-government funded course, you have limited options to finance your studies. You could apply for a non-bank financial institution loan usually at high-interest rates,” explains Olding.
In 2019, there were three million full fee-paying vocational students who were ineligible for Government support, with numbers continuing to rise.
This is where ZeeFi comes in to fill the funding gap, enabling education providers of all sizes, to help students pursue their goals.
As IT student, Natasha Powell, who chose to study with private provider Learning People explains: “I could no longer work as a commercial pilot due to leg injuries sustained in a car accident. I decided to re-train for a career in cybersecurity but worried about how I was going to pay for it.
“ZeeFi took the time to speak to me and offered me a convenient payment plan that I was comfortable with,” she said.
ZeeFi has secured a $50millin debt facility for its suite of education payment solutions from Australian alternative investment manager Alceon.
Entrepreneur Anthony Hynes, who sold his B2B payments company eNett for $577million to US company WEX, is chairman of ZeeFi.