TEMPO.CO, Jakarta - Last month, state-owned banks was not up for President Joko Widodo’s (Jokowi) challenge to provide students with the option of student loans. However, companies of Fintech (technology-based financial services providers) responded positively to the president’s challenge.
The less enthusiastic response from the banking industry is mainly caused by the fact that it involves high-risk borrowers considering that students do not have a loan track record.
Fortunately, several Fintech companies such as Danacita, Danadidik, and Koinworks dared to take the banking industry’s role.
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Danacita and Koinworks are Fintech peer-to-peer lending companies that focus on funding the education sector. Meanwhile, Danadidik is an academic funds provider that is on crowdfunding as its main financial backing.
The three platforms also provide a long-term loan for university students with a tenor from four to six years. Each of these companies applies varying methods of repayments from 9 percent- 20 percent low installments up to profit sharing a student’s wage once they have found jobs.
Co-founder and CEO of Danadidik Dipo Satria Ramli argue that the banking industry understandably does not fit well into the student loan scheme since banks consider it risky to lend funds to borrowers with an unclear source of income.
“Ideally, Fintech should work together with banks in financing education. It is more efficient for banks to invest through Fintech channels, with its low cost and a flexible risk management,” said Dipo on Tuesday, April 3.