SoFi Funds $1B in Student Loans, is Lobbying Working?
Student lender SoFi crossed $1 billion in student loan refinancing through its corporate partnerships which lets employers like Microsoft pay for student loans.
The announcement is rightly timed as lawmakers push for bills that give tax benefits on employer-paid student loan repayment programs.
Companies can contribute as little as $100 a month to refinance employee student loans or offer to refer them to SoFi as part of the bonus package. All roads thus leading to SoFi.
What SoFi likes to boast as the “hottest employee benefit,” over a 401k plan, is being advocated for by Congressman Rodney Davis, who is pushing the Employer Participation in Student Loan Assistance Act, which gives employees a tax-exempt benefit of up to $5,250 per year to pay on their already incurred student loan debt and allows employers to deduct the subsidy provided to employees.
“The Employer Participation in Student Loan Assistance Act encourages employers to be part of the solution by allowing them to offer an employee benefit that will help graduates pay down their student debt. With outstanding student loan debt totaling more than $1 trillion, we must find ways to engage the private sector and help graduates manage their debt,” according to Davis’ website.
And he did find ways to engage with the private sector. Records show that SoFi spent close to $130,000 in the last two years, lobbying to get the bills enacted into law. The act which ostensibly helps employers attract and retain young talent creates a bigger market for SoFi loans.
And with $1 billion in originations, it seems to have gotten itself a great deal. And in its own words, “with programs like these, everybody wins.”
Last modified: April 20, 2019