Julie Moreno, University Relations, MPOWER Financing

Julie Moreno is the director of university relations for MPOWER Financing, a mission-driven fintech company and the leading provider of global education loans that do not require a cosigner. 

 

The international student population in the U.S. has exploded to 1.1. million. The U. S. houses some of the most well-regarded universities in the world, which offer, upon graduation, some of the best opportunities for career growth. 

These universities provide a global supply of highly educated workers and flow talent into the U.S. labor market. A critical but often overlooked aspect of higher education, outside of university boardrooms and campuses, is the importance of international students, both for the community and the economy. 

International students bring a wealth of diverse perspectives onto campuses and classrooms and enhance the overall learning experience for all students. They also contribute greatly to the research conducted on campuses, furthering scientific exploration and breakthroughs. In fact, this year’s Nobel Prize winners for Chemistry and Medicine were international students that had studied in the U.S. 

Each international student who decides to come to the U.S. for education offers their chosen university a gift. What these students can learn at university is well-known; what is not as apparent is what we can learn from them. And that perspective is invaluable.

One student from Zimbabwe who came to the U.S. to study is someone that comes to mind. This young man created an electricity  generator that uses biodegradable materials for his local village. This is someone who saw a problem, found a solution, and created the necessary infrastructure to make that system a reality. He is someone who made innovation take flight. His classmates benefited from his ingenuity and learned about a problem that many have never faced in their lifetime. 

Not only do these students offer diversity to our universities and communities, they also contribute greatly to the local communities in which they study. In the U.S., it’s estimated that during the 2019-2020 academic year, international students contributed $38.7 billion to the economy. This is not just in tuition and fees, but in consumer spending for the purchase of goods and services, dining out, renting an apartment, and the list goes on. 

Higher education institutions have long recognized the benefit of international students and have actively been recruiting them from around the world for generations. Often seen as a revenue driver for universities, international students typically pay full tuition as they are left out of the traditional financing programs and grants that are offered to domestic students.

Often, the “easiest” part of the international student’s journey is getting accepted. Once the acceptance letter is opened, the student must obtain a visa. The process for a visa requires that a student must first provide financial documentation and proof that they can pay for their education. 

If required, they must also find a way to access financing. Many students rely on their families, which comes with its own set of issues. Families that can obtain financing do it at a high cost and often by putting their assets on the line. Students that do not have those resources are typically forced to take out in-country loans, with rates that exceed even the highest interest rate credit card in the U.S. 

So, the question becomes – how is this an acceptable or sustainable process? How will the walls that are put up time and again for these talented students, whose skills directly contribute to the global economy, come down? The answer is complicated because the issue is complicated. But it starts with offering support and rethinking eligibility for financing. 

Overall, the lending industry has remained unchanged for decades. Eligibility is determined by a set of criteria – credit history, credit score, income. Think FICO. If you fall short in one of these categories or fail to meet one piece of criteria, you are either rejected, asked to put up collateral, or have a cosigner. For international students seeking to better their lives, they risk potentially burdening their families in their home countries whose assets may be limited. 

Universities must work in tandem with their students to help with viable financing options that are more easily accessible and without huge sacrifices. These options include providers with competitive interest rates, the possibility of no-cosigner loans, or unique ways of determining eligibility, like evaluating future earnings potential. 

Take the student from Zimbabwe I mentioned above. He was able to break down the barriers that exist and is earning his computer science degree in the U.S. The funding he received has multiple benefits – the ability to get an education at a university in the States and give back to his home country while not further burdening his family. When we remove the barriers to financing, we help with the visa process and we help with the ability to focus on education. The impact that is felt is global. 

As universities struggle to maintain their bottom line and recruit more international students, providing easy access to resources that break down these barriers will be critical. Otherwise, many universities may find themselves losing out on top students and the ideas that they bring with them.

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