ImpactAlpha, May 9 — Washington, D.C.-based MPOWER provides loans that don’t require a cosigner or collateral to international students and “DREAMers” to attend more than 400 universities and colleges in the U.S. and Canada.
The majority of students are from countries in the global south, says MPOWER, who begin paying back the loan while they’re in school at an average interest rate of 12.7%. The alternative is higher-interest loans that are more burdensome for students and their families.
MPOWER secured a $150 million financing facility from Goldman Sachs to support its portfolio expansion and supplement another such line of credit secured from Deutsche Bank last year. MPOWER raised $100 million in equity capital in 2021 from investors including Tilden Park Capital Management and King Street Capital Management.
MPOWER launched in 2014 to help fund higher education for students from low-income families and make sure they weren’t saddled with debt they couldn’t repay. It underwrites loans based on a student’s likelihood of graduating and earning potential, and places caps on borrowing amounts to avoid overburdening students.
At least 5,000 of its more than 6,000 student borrowers have graduated, and nearly half are women and come from families with an annual median income of $12,000 or less, MPOWER reported. MPOWER’s Refugee Scholarship program has provided more than $500,000 to asylum seekers and other refugee students.