In India, where 800 million of the country’s 1.3 billion people live on less than $2.50 a day, education is essential to helping youth populations move out of poverty. Yet, India’s public school system is insufficient to serve almost 400 million children under age 14. Almost one-quarter of all school-aged children are not enrolled in school and of those children who do attend school, more than half attend private schools.
Solution and Impact
Financing to Varthana is helping more low-income children access the education they need. Varthana is a business that provides loans to affordable private schools that fill the gap in education that government schools cannot meet.
These schools—which are different from the higher-cost premium private schools—typically charge between $5 and $15 per month. Entrepreneurs in India have launched hundreds of thousands of these schools to reach more low-income families but because traditional financial institutions do not typically lend to this sector, the schools struggle to invest in equipment, technology, teacher training and even basic facilities: More than one-third of all schools lack toilets.
Since Varthana was launched in 2014, it has provided financing to 6,000 schools across 15 states in India, serving 4.2 million students.