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> Posted by Jeffrey Riecke, Communications Assistant, CFI

Between 2000 and 2007, college enrollment in low-income countries increased from just 5 to 7 percent. In 2003, the World Conference on Education Partners articulated the severity of this situation by stating, “At no time in human history was the welfare of nations so closely linked to the quality and outreach of their higher education systems and institutions.” It’s exciting to share, then, that the Higher Education Finance Fund (HEFF), the first microfinance fund working in student lending, is launching its first program.

A US$ 34 million fund and a parallel donor-funded technical assistance facility, HEFF lends to and provides technical assistance to microfinance institutions and other financial intermediaries who then use the HEFF financing to fund student loan portfolios. The fund targets low-income students who wouldn’t otherwise be able to take advantage of scholarship programs and/or publically-funded universities.

HEFF is built around a model that’s sustained by the success of its students. The fund provides long-term loans that are to be repaid by the students as professionals who have entered the job market. The HEFF’s business model is based on analysis of careers that position students as capable of repaying their loans. HEFF offers loans to students whose career paths are in high-demand in their respective countries and offer suitable salaries for new-entry employees with those skills.

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