Credit Climb Shakes Up Student Loans

When it comes to higher education lending options, many students have found themselves in scenarios with loans they simply can’t pay back.

But there’s also a growing number of startups trying to step in with solutions, including options to help those students refinance loans. And then, there’s Climb Credit, a new startup in the market that’s getting some attention, as well as a $400 million lending facility. It’s a company that says its approach is tailored around encouraging students to pursue the best options.

“We started Climb to fund what we call high ROI education,” Cofounder and CEO Zander Rafael told TechCrunch. “It’s education that actually works and benefits the student.”

What this comes down to is ensuring students are getting the best bang for their buck, which, in this case, means providing loans based on specific programs that students want to be part of. Essentially, Credit Climb is coordinating with schools to offer loans to the students at those schools it believes are poised for success.

“Most schools aren’t providing the value to the students that the students want and the employers want. Dropout rates are high, which leads to higher defaults, and even if you do graduate, you don’t necessarily get the skills that you need,” Rafael said in the interview.

Climb Credit has 40 schools that it works with across 70 campuses. It chooses schools based what they are doing to encourage success, such as preparing students for their future employment and cutting costs in order to focus more on student success over building infrastructure. Climb Credit also works to make deals with students who can’t pay back loans if they can’t find a job.

“We find industries that make sense, where we know there’s a lot of demand for employment, and we go out and we find students and judge their outcomes,” Rafael told TechCrunch.