Buy Now Pay Later (BNPL) financing, which burst into the consumer market as a shopping solution, has matured. Creating an opportunity for us, as education finance specialists, to tailor B2B solutions for small and medium sized training providers and boost their profitability with Study Now Pay Later.
Nearly half of Australian adults (7.8 million people) undertake some form of education or training each year, according to a new ABS study on work-related training and adult learning, with the pandemic accelerating online learning, as work-related training doubled from 19% in 2016-17 to 55% in 2020-21.
The appetite for online learning continues to grow at pace in 2022, as organisations increase digitalisation in their businesses while also embracing hybrid workplaces.
Since COVID-19 disrupted our lives, HR experts have been speaking about the strength of being able to flex a variety of skills muscles to become more future-ready and crisis proof, including this Harvard Business Review article which describes Hybrid as the one key term at the heart of today’s accelerated pace of change – hybrid talent, hybrid workplaces, hybrid cultures and hybrid careers.
In fact, Deloitte Access Economics forecasts that soft skill intensive occupations will account for two-thirds of all jobs by 2030, compared to half of all jobs in 2000. And the number of jobs in soft-skill intensive occupations is expected to grow at 2.5 times the rate of jobs in other occupations.
And the Australian Financial Review reports that a revolution is under way in how education is created, delivered and consumed – with traditional degrees and diplomas being supplemented or even supplanted by short, resume-ready courses – popularly termed micro-credentials.
The power of SME education providers
What it means is that SME education and training providers are perfectly placed in today’s revolution. 27% of Australians (5.1 million people) last year undertook courses that led to no formal recognition, compared to one in five people (3.8 million) who studied for a formal qualification such as a degree, diploma or certificate.
The significant shift in skill requirements in the workplace is driving an enormous amount of reskilling and curiosity around new skills, says Macquarie Business School’s Kristine Dery, who explains that opportunity and availability of courses at affordable prices are now enabling people to experiment more than they ever did in the past.
Unlock capital, increase enrolments
As the ABS study reveals, about 638,000 Australians (3%) said they wanted to enrol in a certificate, diploma or advanced diploma but could not. For 28% of these people, the main reason was having too much work or not enough time, with 23% facing financial barriers from lack of student loan help.
At the same time, just over 7% of Australians aged 15-74 years wanted to do work-related or personal interest courses in the last 12 months but could not. The main barrier to non-formal learning was having too much work or not enough time (38%), followed by ‘other reasons’ (25%) and financial reasons (18%).
Which is why Study Now Pay Later plays such a pivotal role in tearing down the financial barriers that impede the growth of both SME education providers and their students. Study Now Pay Later enables:
- Fast access to working capital – education providers get fully paid for courses upfront, while their student pays their course off over time.
- No credit risk to education providers from customer payment defaults– we take the risk.
- Education provider can focus on delivering quality education – we do the heavy lifting in managing and collecting regular student repayments for up to 36 months.
Why choose niche BNPL capability?
Specialisation means having a purpose-built B2B solution that accommodates the payment nuances of ONE industry.
It means deeper understanding and higher success rates.
And it means agility to adjust the platform and processes as the industry evolves.
The insights to create a full suite of solutions for a variety of financial scenarios – alternate options, portfolio management, cash advances.
And the empathy to have a human touch – more than just a finance platform, approvals and collections involve real conversations using a tailored process that is sensitive to the needs of students and the reputation of the education provider.
By Adam Olding, ZeeFi CEO
This article was originally published in Inside Small Business, 6 April 2022.