- MPOWER Financing is a public benefit fintech company that moves beyond credit scores to lend money to international students. To learn more, Pulse 2.0 interviewed Sasha Ramani, the head of corporate strategy for MPOWER Financing.
MPOWER Financing is a public benefit fintech company that moves beyond credit scores to lend money to international students. Rather than relying on credit scores, collateral, or co-signers, MPOWER uses a forward-looking algorithm that assesses earning potential. To learn more about the company, Pulse 2.0 interviewed Sasha Ramani, the head of corporate strategy for MPOWER Financing.
Sasha Ramani’s Background
Ramani is originally from Toronto but moved to New York City after finishing college to work in management consulting and investment management. And Ramani enjoyed that work but wanted to pivot his career to something more socially impactful, which led him to pursue a Master’s degree at the Harvard Kennedy School – which is where he learned about MPOWER Financing.
“MPOWER’s mission resonated with me, as the son of immigrant parents and an immigrant myself (though I like to joke that as a Canadian in the U.S., I’m barely an immigrant). But even for me, it was a pain to open a bank account or get my first credit card in the U.S. – so imagine what it’s like for someone from India, China, or Mexico?” said Ramani. “That question stuck with me, and democratizing access to education for students from the Global South became an issue that I’ve been quite passionate about.”
Day-To-Day Role At MPOWER Financing
With the position of Head of Corporate Strategy, Ramani noted that on paper that means driving strategic projects such as an expansion to Canada and the launch of the international student loan refinancing product.
“But I also contribute to a lot of other areas of the firm, including driving investor relations, strategic communications, and at times university relations and the entire Canadian business,” added Ramani. “I’m jokingly referred to as a Swiss Army knife: no matter what you need, your trusty knife is the tool that will get it done.”
Challenges Faced In The Job
Ramani noted that most of their team is based in India, which means that there are a lot of early morning calls.
“I’ve learned a lot about managing a team remotely and navigating cultural differences that arise with a global team. I love learning new things like what an EMI is (equal monthly installment) – a very India-specific acronym that’s relevant to our business, but which I’ve never heard of before,” explained Ramani.
Core Products/Features
MPOWER’s core product is a student loan for international students. The company offers the leading no-cosigner, no-collateral loan to students from over 200 countries around the world across about 400 top universities around the U.S. and Canada.
The loans are issued at attractive fixed interest rates, which means that interest rates do not rise over time. And MPOWER helps students navigate immigration and life abroad here in the U.S. so that they are as successful as possible both in school and after graduation.
“One of the ways we do this is through our Path2Success program, which assists our students with career support, mentorship, and networking opportunities,” Ramani noted.
MPOWER’s Biggest Milestones
Some of MPOWER Financing’s biggest milestones include:
— Incorporated the firm in 2014 and made the first loans in 2015.
— In 2017, the company expanded nationwide across the U.S. through a partnership with the Bank of Lake Mills.
— In 2018, the company expanded to Canadian universities.
— In 2019, the company raised a $100 million loan facility from Goldman Sachs.
— In 2021, the company raised a $100 million equity round from a consortium of investors, including Tilden Park Capital Management and King Street Capital Management.
— Last year, the company made a commitment of $500,000 in scholarships to refugee and international students from around the world, hired their CFO, and expanded our network of schools to over 400 universities.
Customer Success Stories
Do you have any customer success stories?
“So many! When we read verified student success stories on Trustpilot (where we’re rated 4.6 stars), the word that jumps out is ‘dream.’ You might think our product is ‘just’ a student loan, but for our students, it’s a dream to study abroad. We’re thrilled we can help them secure the footing that gets them into the global middle class,” Ramani replied. “One of these students is Utkarsh Nigam, a student from Dehradun (small-town India). He excelled as a student but struggled to secure a no-collateral loan from an Indian bank at a good interest rate. Thanks to MPOWER Financing, Utkarsh was able to secure the financing necessary to reach his educational dreams.”
Total Addressable Market (TAM)
I asked Ramani about the total addressable market that the company is pursuing. And Ramani pointed out that international students spend $61 billion annually in the U.S. and Canada by paying tuition, renting apartments, or buying groceries.
“How can students today possibly pay for everything? Some are able to take advantage of scholarships and government/university support. But the lion’s share is funded by students themselves, or by their families. When you take this into consideration and weigh that we only finance qualified graduate programs and select undergraduate students, we estimate our total addressable market to be $21 billion annually,” responded Ramani.
Differentiation From The Competition
What differentiates MPOWER from the competition?
“When we surveyed our students last year, 91% said that an MPOWER loan was ‘imperative’ to their ability to study abroad. So in a sense, we don’t have any real competition, and our ‘competitors’ are when a student drops out of school or chooses not to enroll in the first place,” Ramani revealed. “Where competition exists, it’s usually from banks in a student’s home country (say, India). Compared with them, we offer a forward-looking credit model that does not rely on collateral or a cosigner. We offer better loan terms, a fast and convenient digital experience, and free immigration and career support through our Path2Success program.”
Future Company Goals
MPOWER Financing’s future company goals noted that they hope to be the neobank of the future, fulfilling all of the financial and professional needs of the global diaspora. And the company could get there by expanding lending to students in other countries, offering additional products and services, or serving a different demographic.
“We have lots of ideas and we can’t wait to build the path to implement them,” Ramani concluded.
