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Strengthening Education Sector Through Fee Financing

Friday, 16 April 2021, 07:36 Hrs

The education sector was in a whirlwind for almost the entire 2020 with no immediate countermeasures available for resurrection. The only silver line which ensured the movement was online education. Though this alone wasn't enough for the whole sector as a lot of educational institutes were even forced to close their operations owing to the financial crisis due to pandemic induced lockdown. This further resulted in huge dropout and reduced access to education to a very large percentage of the population. Lockdown was not only the reason behind dropouts. The job losses and pay cuts due to the Covid-19 outbreak also forced parents to change the educational institutes of their wards or take them out of the formal education cycle.

A lot of educational institutes, with ample infrastructure, shifted to online education which was the need of the hour. The modern day practices are reckoned as the requisites for the ecosystem going ahead and all the policy level framework and innovations are maneuvered towards the same. The education industry is making necessary adaptations to make the most of the digital and online education in the country while mitigating the downsides.

With online education being the new normal, the infrastructure of the educational institutes needs to be upgraded. Meanwhile, affordability still remains the key. In order to make online education feasible and affordable, public-private partnership appears to be a potent way to enhance the quality of education. While making education affordable is necessary, it is also important to look for the options which can facilitate the school education through fee financing. Fee financing comes as a comprehensive solution which creates a win-win situation for both, educational institutes as well as parents. It not only helps the parents in paying the school fee without any extra burden but also helps the educational institutes in managing their finances. With fee financing we can ensure quality education along with digital education content to provide holistic education even to the most vulnerable class.

The resurgence in the Covid-19 cases and closure of the educational institutes in various states, it is evident that the education sector has to face the challenge for quite some time. Since the fee financing companies pay the entire year’s fee in advance, the educational institutes get ample funds for the whole academic session while parents get the benefit of zero interest and zero cost EMI. Therefore, this new age financing solution comes as the one-stop solution for educational institutes as well as parents.

With this model in place, the educational institutes can leverage the funds to plan out their expenses in a managed way whereas parents are not forced to compromise with the education of their kids. This model not only helps in infusing funds in the education sector but also helps in lowering down the dropout rate. School fee financing models can also contribute in increasing the enrollment as parents are not burdened with the increasing education expenditures and they can plan the education of their child with ease.

In the crisis, the fee financing model creates a synergy effect in the education ecosystem and releases the pressure from both parents and educational institutes. So, while accepting the other new norms, the educational institutes should join hands with the fee financing companies so as to make parents aware of the option so that they can avail the facility to ensure uninterrupted quality education for their wards. In order to drive modern-day education and to enable access to quality education to almost all the students from every corner of the country, it is necessary for the government to encourage fee financing models so that the dropouts can be stopped and a big gap in the education sector can be filled.