Edly raises $175m to offer income-based repayment student loans in US

American student loan platform Edly, which offers income-based repayment (IBR) loans, has secured up to $175m in future flow financing commitments.

The funding will be made by funds and co-investment vehicles managed by Medalist Partners and Windmuehle Funds.

Both the investment firms have also made direct investments in Edly.

Edly, which is said to be the only private sector platform offering IBR loans, will use the proceeds to offer education loans to more students pursuing degrees in nursing, STEM, accounting, and other areas.

The firm underwrites loans by focusing on historic student outcomes, schools and programmes and bases loan payments on a student’s future salary.

Edly CEO Chris Ricciardi said: “We are truly fortunate to be able to partner with best-in-class investors like Medalist and Windmuehle. The combination of their experience and financing will deliver a powerful boost for our mission to close the funding gap and help solve the student loan crisis.”

Students getting an IBR loan agree to pay a fixed portion of their salary for a fixed duration when they start earning a threshold salary.

Medalist Partners private credit sector manager Jim Regan said: “We believe the combination of strong underwriting, product innovation, and a top-notch management team is a great recipe for success. We are excited to add this credit facility to our portfolio of high-quality asset-based lending programs.”

Windmuehle founder and chief investment officer Robert Lee said: “Windmuehle is excited to partner with Edly in providing outcome-oriented financing solutions that are aligned with student success.”