Recognizing the Potential of Community Lending
Floor Speech
Mr. ANDREWS. Mr. Speaker, I rise today to recognize some recent innovations in private lending to graduate and undergraduate students in U.S. colleges and universities. I also want to encourage our nation's wealthy individuals to think about participating in these programs as one way to give back to our communities. Since its inception in 2011, the Social Financial company, or SoFi, has offered compelling community-based lending and consolidation programs, and this academic year will assist students from 45 colleges and universities across the country.
At its core, SoFi demonstrates the powerful idea of community lending. It brings alumni, students, and schools together to ensure students' debt burdens are manageable. For the upcoming 2012-13 academic year, SoFi used its equity base and additional capital from alumni to secure $80 million to finance, fund, and support new student loans. This innovative student loan solution benefits students, alumni, higher education institutions, and our nation. The funds from school-specific lending pools allow students to enjoy comparatively low-interest loan rates and opportunities to refinance previous loans. In addition, the alumni that contribute to the pool earn a significant and low-risk return, while schools gain access to low-cost funding.
Mr. Speaker, although I do not expect private lending schemes to supplant available federal loan structures, I believe Social Financial's commitment to the betterment and transformation of the financial services landscape for students sets an example for how to innovate in this field. I commend SoFi for its hard work, community partnerships and innovation, and congratulate SoFi on its continuous expansion to schools across the U.S. In order to tackle student debt, we will need to be creative, in exactly the ways SoFi has been. I encourage those who have the means and desire to give back to follow Social Financial's example and invest in the education of the next generation.
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