Startup Fintech Lending Cita Funds Help Students Take Formal Education

The low gross enrollment rate of higher education institutions in Indonesia, which is still around 28%, is a business opportunity for fintech lending startup Dana Cita. With a different business model compared to similar players, Dana Cita wants to realize the dreams of every Indonesian student through affordable education loans.

"We see the potential to bridge the financing gap so that Dana Cita was established in early 2017. So that every child of the nation who wants to continue their studies can reach their maximum potential," explained Dana Cita Co-Founder Susli Lie to DailySocial.

In running this business, the company applies a two-borrower system. The student takes a guardian with verified income to apply. Thus, companies can provide loans of up to 100% of tuition fees. The tenor is also longer (maximum 6 years) and affordable monthly installments, generally ranging from 1-1,5% (flat) per month.

Through this method, Susli hopes that Charity Fund can encourage outstanding students who previously did not register for college due to funding problems to dare to continue their studies without worry.

Education loan itself is a form of credit without collateral that has risks. To mitigate this risk, the company only provides loans that are only intended as education costs and the disbursement is made directly to the educational institution.

"Beyond that, the credit evaluation process and approval we adjust for factors that refer to students and education, such as study programs, educational institutions, types of degrees, and so on."

Until now, the total funding that has been disbursed has reached approximately Rp. 1,5 billion for various study programs, such as D3, S1, S2, and even short courses. Loans were given to 28 educational institutions, including UI, ITB, IPB, BINUS, UMN, PNJ, and various other educational institutions, both public and private schools.

In distributing financing, Dana Cita uses institutional funding sources so it is not called on balance sheet lending.

"Indeed, for now there is no open fundraising from individuals through online platforms, but in the future we will open this approach along with growth demand for student loans."

Target Fund Cita

Not wanting to be satisfied with the current achievements, Susli and the team hope to channel funds to help as many students and prospective students in Indonesia as possible. Unfortunately he did not mention in detail the target in the form of numbers.

According to Susli, the company wants to participate in improving the quality of human resources, with a quantitative indicator in the form of an increase in the gross enrollment rate of universities in Indonesia. This figure is currently very low, at around 28%. In fact, every year there are 1,4 million high school / vocational high school graduates who go to college.

"We dream that Dana Cita becomes a top of mind when a person decides to pursue higher education. Prospective students should put their biggest focus on how to get accepted into their dream college, not the financial problems they face," concluded Susli.