Access to Finance for Low-cost Private Schools in Pakistan

Bari, Dr. FaisalRichardson, EmilyGul, NasreenIlm IdeasSocio-Economic & Business Consultants Pvt. Ltd. (SEBCON)UK Department for International Development (DFID)2014
PDF icon Access to finance for low cost private schools May 2014 FINAL.pdf

There is little private sector development research that analyzes the LCPS sector from a MSME entrepreneurship perspective in Pakistan. However, an International Finance Corporation (IFC) report on private schools in Pakistan asserts that 76% of private schools produce financial statements. While low fee schools are increasingly viewed as an attractive investment proposition for commercial investment purposes, it is essential to explore financing options for such schools to secure long-term financial viability.

The objective of this study is to determine how impact lending – bank credit from both microfinance and
commercial banks – can be provided to the LCPS owners or education entrepreneurs, also referred to as “edupreneurs” for quality improvements and sustainable expansion.

Our survey data suggests that in order to reach informal LCPSs there is a need for an approach within the microfinance sector. This report proposes a program-based lending model, developed for microfinance institutions with indicative loan products designed to respond to the distinct needs of LCPSs.

Low-Cost Private SchoolsPakistanOriginal research

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