Student debt is a huge issue in America, and it’s only getting worse. In this blog post, we will explore how FinTech can help solve the student debt crisis. We will look at how technology can be used to make it easier for students to pay back their loans, and we will discuss some of the benefits of using FinTech in this area. Stay tuned for more information on this important topic!
According to the Brookings Institution, 40 percent of student loan refinancing borrowers are expected to fall behind on repayments after the U.S. Department of Education lifts the repayment moratorium enacted in response to COVID-19. The findings are based on a survey of more than 1,000 student loan borrowers. While the report notes that many people have been able to keep up with their repayments during the pandemic, it predicts that this will change when the moratorium is lifted and people are required to start making payments again.
The report also found that nearly 45 million Americans hold $1.7 trillion in student debt, and experts say many don’t understand the loans that were given to them or the refinancing options available.
The student loan space has seen a proliferation of companies using technology, or FinTech, to make the process of borrowing and repaying loans more efficient and less bureaucratic.
The federal government is the largest provider of student loans, accounting for 92% of all outstanding student loan debt. However, private education loans still account for 7.76% or $124.65 billion, creating a sizable market for FinTech companies to address.
What is FinTech?
FinTech, short for financial technology, is a rapidly growing industry that uses technology to improve financial services. In recent years, FinTech has been used to develop innovative solutions in areas such as payments, lending, and investing.
Benefits of using FinTech in relation to student debt?
There are a number of ways that FinTech can help solve America’s student debt crisis.
For example, technology can be used to make it easier for students to pay back their loans.
Additionally, FinTech can provide borrowers with more transparency around their options for refinancing their loans.
Finally, FinTech can help connect borrowers with lenders who may be able to offer them more favorable terms.
While there is no one silver bullet that will solve the student debt crisis, FinTech holds great promise as a tool that can help make progress in this area.
Top FinTech companies that offer services related to student debt?
Earnest: Earnest is a FinTech company that offers student loan refinancing. Earnest allows borrowers to customize their repayment plans based on their individual needs and goals.
SoFi: SoFi is a FinTech company that offers student loan refinancing, among other financial services. SoFi has helped over 500,000 people save money on their student loans.
LendKey: Lendkey is a FinTech company that partners with community banks and credit unions to offer student loan refinancing. LendKey works with more than 300 lenders across the country.
CommonBond: CommonBond is a FinTech company that offers student loan refinancing. CommonBond has helped over 100,000 people save money on their student loans.
If you’re interested in learning more about how FinTech can help, be sure to check out our blog for more information on this important topic! Stay tuned for more updates! Thanks for reading!