A start up venture offers loan payback program that companies can take up for their employees.

Many companies do offer to pay back tuition payments that employees can opt for which will help them to continue with their education which will help them in getting a professional degree that will help them in advancing their career in the firm or with their job. This program also acts as a great tool for hiring young employees.

These programs however, do not help new recruits who might be already burdened by student loan debts which they took on for graduation. Gradifi is a startup company in technology based out of Boston, which helps address this problem. They help set up a platform that will allow employers to directly contribute towards paying off small personal loans and debts of employees in a secure manner. Gradifi was formed by Tim DeMello, who is CEO and founder of the platform who is also a trustee of Babson College and he obtained the idea when there was a presentation at the college in 2014 about how student debt was increasing and many people were burdened with it.

Gradifi obtained Pricewaterhouse Coopers as the first high profile client firm who signed on with them in 2015. The company puts aside $1200 every year for employees for a tenure of six years, which would help employees pay off their loans, especially in the first few years of employment. Even though the amount is not enough to pay off all kinds of debts, the average balance of loans being $26,700, it would definitely go a long way to help reduce employee debt as well as increase goodwill among employees.

Student loan repayment programs become useful recruitment tools for companies that have a need for hiring new graduates. This is particularly true for white collar positions in companies that require graduates of certain qualifications from entry level itself. Surveys have shown that, professions that require bachelors degree as well as higher levels of qualification include professionals who would like to find repayment assistance with the benefits that employers extend to entry level employees.

Firms can distinguish themselves by offering benefits like loan payback schemes for students. This is still a kind of benefit that is rarely found among employers, only about 4%.

PwC is an ideal employer for such a program as they recruit about 16000 students every year and require them to have different kinds of professional degrees, but this company is not the only one that sees the benefit of helping recent hires with their student loan debt. There are other clients of this firm such as First Republic and Peoples Bank, Penguin Random House and others. DeMello however, feels that the next five years will see many more companies offer such a benefit in different ways. It would also help companies raise effective pay without having to raise salary brackets outright. All signs point towards this being a useful perk for the students, but it should be part of a support system that has other benefits to offer as well.

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