The WaFunda ISA will enable over 4 000 students who are barred from completing their tertiary studies to clear their debt, graduate, and enter the workforce.
Social impact enterprise, WaFunda, has launched its Income Share Agreement (ISA) Fund to enable thousands of low-income and ‘missing middle’ students to enter the working world.
The ethical, alternative funding model has been designed to work alongside the potential earning capabilities of students once they enter the working world. It will ensure that more than 4 000 work-ready, young South Africans who have successfully completed their studies are able to settle their student debt and graduate.
For millions of young and aspirant South Africans, tertiary education opens doors, but funding constraints often close them. Unfortunately, traditional student loans and funding models can be rigid, inaccessible, or costly, leaving many asking; ‘is there an alternative way to fund education?’.
“The WaFunda ISA Fund is an NCR-registered, sustainable solution that actively addresses the growing ‘missing middle’ group of tertiary students unable to enter the workplace,” says Duncan Patrick, Head of Product at WaFunda.
Funded by Standard Bank South Africa, Bridges Outcomes Partnerships and First Rand Empowerment Foundation, this alternative student financing model settles final-year university debt directly with institutions so graduates can receive their qualifications.
“Together with our university partners, we can provide access to finance for both undergraduate and postgraduate students across multiple faculties and degree types,” explains Patrick.
“Unfortunately, traditional student financing models have proven to be unsustainable,” reports Leana de Beer, Founder and CEO of WaFunda. “For example, the National Student Financial Aid Scheme (NSFAS) owes public institutions well over R10.5 billion in tuition payments for funded students, and universities cannot keep absorbing the debt.”
“The education funding eco-system in our country needs rethinking, and it is imperative that young people become part of the solution,” she continues. “This can only be achieved by leveraging technology and strategic partnerships to connect students’ outcomes directly with sustainable funding opportunities, financial tools, and support systems that are tailored to their educational journey.”
Patrick foresees that access to quality higher education in South Africa is set to become easier and more affordable for low-income and ‘missing middle’ students.
“Financial support should be designed around a student’s future capacity, and not their current capacity to prove access today,” he says. “Access to higher education should not be exclusionary, and that principle is at the centre of how WaFunda holistically supports students who are faced with financial challenges.”
The WaFunda ISA model
“An ISA is a contract through which a student receives money to pay for their education, and in exchange commits to paying a predetermined percentage of their post-graduation income or earnings back for a certain period,” explains Patrick. “This financing links to actual earnings ensuring graduates avoid unaffordable debt, and collections paid by the employed graduates are reinvested to support more students.”
Key features of the WaFunda ISA
● No family surety/collateral required to access financing.
● Repayments begin only when graduates earn above a living wage.
● Payments are income-based, ensuring the debt is affordable.
● Creates incentives for the investor or ISA provider to support the young person as payment is predicated on graduate success.
Recognising that financial access and building financial literacy is the first step, the WaFunda ISA integrates student-centric guidance to help young South Africans manage their education funding, build credit awareness, and prepare for career success.
“Education is the single greatest catalyst for personal growth and economic empowerment, however our mission goes beyond simply providing funding,” says Patrick. “We are building a collaborative ecosystem where technology removes barriers, opens doors, and ensures that financial limitations never stop a determined student from reaching their full potential.”
Empowering students through smart technology and financial access
The WaFunda ISA brings financial inclusion directly into the hands of aspiring young people through rethinking risk, streamlined funding access, impactful collaboration, and building multi-level sustainable partnerships.
The relationship does not end when funding does
“The continuing monitoring of student progress well past graduation, and into employment, tracks a graduate’s earning capability, allowing for deeper insight into a student’s capabilities over time,” he explains. “That is what makes the model self-reinforcing.”
To learn more about funding opportunities, partner initiatives, or how to apply, visit www.wafunda.com or contact WaFunda: t: +27 (0)21 201 0210 or e: [email protected]
