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FinWise Bank and Stride Partner on Employer-Sponsored Loans for Students

FinWise, Stride Team on Employer-Sponsored Loans for Students

FinWise Bank and Stride Funding partnered to launch a program that allows students to secure loans sponsored by their future employers.

This collaborative Employer Sponsored Loan (ESL) program is designed to link students’ education directly to their career progression and help reduce their debt after graduation, the companies said in a Thursday (Dec. 14) press release.

“The program is ideally suited to high-quality students willing to commit to working with employers post-graduation in exchange for placement opportunities and financial support for their education,” Stride Funding founder and CEO Tess Michaels said in the release.

The new ESL program is an extension of the Income Share Loan Program (ISP), another collaboration between Utah state-chartered bank FinWise and Stride, a FinTech offering access to outcomes-based education financial products, according to the release.

In the ESL program, students apply for sponsorship through participating employers and, if accepted, are supported with loans from FinWise Bank, facilitated by Stride Funding, the release said. The employer then pays back these loans as an employee benefit over a specified term of employment.

The program is available to students in engineering, healthcare and skilled trade, and it allows borrowing of up to $65,000 per year and $130,000 per student, per the release.

“The success of our pilot program earlier this year demonstrated strong demand for this type of innovative loan solution among both employers and students,” FinWise President Jim Noone said in the release. “Working with Stride, we have refined the offering to create a win-win-win for students, employers and schools with a focus on improving recruitment and retention.”

There is a “huge movement toward outcomes-based funding,” Michaels told PYMNTS in an interview posted in April 2022.

“We’re aligning the cost of education with the value of that education,” Michaels said at the time.

The new solution arrives at a time when PYMNTS Intelligence found that the financial strain of repaying federal student loans is expected to have an impact on millennials’ overall well-being, particularly on their mental health.

Young borrowers worry more about paying back student loans than they do about inflation, according to the “Consumer Inflation Sentiment Report.”