What is 8B?
8B is the first fintech social enterprise specialized in lending to African students to attend world-class global universities. 8B is convinced that Africa must deliver shared prosperity to its youthful population; to do so, African nations require a deep bench of highly educated ecosystem-builders who are equipped to participate, compete, and thrive in the knowledge economy of the 21st century. We help them afford the education to get them on their way. Read more about our Mission, discover our Services, and meet our Team.
Why tertiary education?
Africa’s prosperity requires a chorus of education solutions, ranging from addressing malnutrition and stunting, all the way to primary, secondary and tertiary education. But tertiary education is not a luxury. Research shows strong links between tertiary education and economic development, a link that cannot be wished away just because traditional approaches to financing such education have fallen short. Africa’s vastly unequal access to leading global universities will compound its disadvantage in the knowledge economy of the 21st century, where the ability to take advantage of opportunities will depend on having highly educated and globally connected ecosystem-builders in every sector. Put differently, tertiary education is a necessary component in Africa’s pathway to prosperity and sustainable development – though by no means a sufficient one.
How does 8B handle defaults?
We guard against student default through three processes:
First, as part of our due diligence, we use all available data to assess default risk, then connect with students to understand their motivations. We also inform students of their loan obligations, as 8B education financing is likely to be the first loan obligation undertaken by African students.
Second, 8B’s origination and servicing capabilities are designed to reduce flight risk. Toward this end, 8B is building partnerships with entities in student home countries as well as globally. Further, 8B makes post-graduation repayments income-contingent, and maintains ongoing communication with graduates. In the unlikely event that we are unable to contact a student, the reputational guarantors who are named on a student’s application are contacted as every effort is made to reconnect with the student.
Third, much like loans in the US and elsewhere, students are informed prior to signing an agreement that non-repayments will be reported and have consequences for their personal credit score, which will affect their ability and that of other students with similar profiles- be they from the same country or program of study- to receive funding. As a result of these measures, we expect the levels default of our carefully selected students to be comparable to those of US college graduates from similar programs.
Does 8B promote braindrain?
8B is designed to work with income-contingent repayments so that students have geographical flexibility. Additionally, in due course, we will develop a robust career development program aimed at reducing barriers to return to the continent. However, 8B does not presume to tell African students where they should live and make their careers.
As a debate, it is worth noting that an active discussion continues on whether education outside Africa encourages the “brain circulation” necessary for Africa’s integration in a global economy, and is therefore a net gain, or whether it is an unmitigated loss that can be fairly characterized as “braindrain”. At 8B, we are convinced that on the whole, while acknowledging sectoral differences, there is merit in African talent being global. It gives us comfort that 193 countries have agreed to the Sustainable Development Goals, one of whose targets encourages the international community to substantively expand the number of scholarships available to African countries – suggesting that “brain circulation” is winning the argument.
Practically, while Africa is in the process of building her own world-class universities – a process that deserves all the support possible – we see an obligation to work toward ensuring that Africa’s exceptional, creditworthy students can access world-class centers of learning and innovation today.
What is 8B's role in career advancement for African students?
8B is building the technology through which fellows will be knitted into a strong network that will accompany them on their pathway to success. The mentorship program through the 8B network will expose fellows to opportunities to forge relationships with individuals with experience in their field, supporting their pathways to success.
How does 8B measure success?
8B will consider itself successful if it can attract increasing amounts of capital into African student finance, which will in turn increase the number of African students who receive funding, graduate, obtain employment in their sectors of choice. Our target is to contribute to increasing African graduate students by 10x and unlocking $1billion in student financing by 2030. In a context of declining Official Development Assistance and competing causes for philanthropic dollars, we believe that 8B’s model is an example that can be used to unlock new financing for the development of the human capital required to meet the SDGs across all sectors.