Online student loans provider applies for consumer credit licence
A new online student loans provider intends to enter the Irish market as early as this summer.
Dublin-based financial technology company Future Finance has applied to the Central Bank for a consumer credit licence.
The company was founded in 2013 by Chicago native Brian Norton and moved to Dublin last year with the assistance of the IDA. It employs a team of 55 across its Dublin headquarters and two smaller offices in London and Munich.
Future Finance currently provides loans to students in the UK and Germany and plans to expand elsewhere in Europe, as well as in Ireland. It has loaned out around £25m (€31m) to about 3,500 students so far.
The company has raised £185m (€234m) in total for growth and lending capital, following a £119m raise last month from investors such as Colchis Capital, Ridge Road Partners, DW Partners, Fenway Summer Ventures and the Blackstone Strategic Opportunity Fund.
Norton told the Sunday Independent that if granted authorisation by the Central Bank his company will make loans available both to Irish students and international students studying in Ireland.
The loans will cover tuition and "stealth tuition" costs like registration fees - most Irish undergraduates pay around €3,000 every year in registration fees to universities. Finance will also be made available to students to cover day-to-day expenses. The cost of living in Dublin is one of the highest of any EU city.
"The cost of living is often the main expense that deters people from doing an undergraduate or graduate degree," said Norton.
"We want to launch in Ireland because third level education offers a really good return on investment for Irish students, and the ability to pay after graduating is what is key for lenders.
"Irish universities and graduates are well regarded internationally and there are lots of good jobs available in this country for graduates."
Students will be able to apply online, with no face-to-face meetings necessary.
In the UK and Germany, Future Finance offers customers up to 10-year loan terms with no early repayment charges and the possibility of payment holidays. Loans of up to £40,000 per academic year are available, though the average loan is around £8,000.
"Almost uniquely, we are not piggybacking on any other lender," explained Norton. "We are lending ourselves. We are building a long-term, world-leading business."
The company will seek to work with Irish universities. In the UK it has partnerships with around 35 universities.
Sunday Indo Business