Shriram Fin is expanding its range of services to include educational loans for individuals opting for upskilling courses for career development. It is an NBFC. This move comes alongside their existing financing offerings for two-wheelers and support for micro, small, and medium enterprises.
The decision coincides with NBFCs’ move to actively broaden their range of services by partnering with educational technology startups. They aim to establish themselves as key providers of student loans and credit cards. They also provide financing options for laptops and electric vehicles, seeking a convenient solution for various financial needs.
This step by Shriram Fin is due to the recent advancement in the upskilling market. This move is also because of a boom in the EdTech sector.
Upskilling Market and Upskilling Education Loans
- The upskilling market is fragmented in nature.
- Individuals opting for upskilling courses often opt for short-term periods.
- Education loans for upskilling courses often range between INR 50,000 to INR 4 lakh.
- Typically, EdTech companies collaborate with NBFCs, and these financial institutions offer quick and interest-free loans to students. While the loan is disbursed directly to the EdTech company, the NBFC retains about 5% of the funds. This allows them to generate revenue despite the borrower not paying any interest.
Facts about Shriram Finance
- In 2022, Shriram Finance achieved the status of being a prominent retail NBFC in India through the merger of two entities. These two bodies are Shriram Transport Finance Company and Shriram City Union Finance.
- With a workforce of more than 64,000, the company is currently making plans to introduce a stock options program for its staff.
- This NBFC usually grants stocks to the top 100 employees. It now aims to include more people. It will provide stocks to branch managers and around 5,000 people.
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