In fall 2021, junior and senior STEM college majors at select historically Black colleges and universities (HBCUs) will be eligible for a new student loan program created by billionaire investment firm CEO, Robert F. Smith.
Smith notably paid off $34 million in student loans for Morehouse College’s spring class of 2019. Now, he has created a nonprofit loan program called the Student Freedom Initiative (SFI) designed to address racial wealth disparities among HBCU graduates. African American college graduates have nearly $25,000 more in student loan debt than their White counterparts, according to federal data.
“Our program is designed so that every $10 million invested in the program will cover 100 new students at [minority-serving institutions] every year, forever,” the SFI website says.
Smith and the nonprofit organization Fund II Foundation will each provide a $50 million gift that the SFI will then use to fund a portion of educational expenses for students. The funds will be provided through an income-driven arrangement called the Student Freedom Agreement. This method serves as an alternative to high cost, fixed payment debt obligations, according to the website.
The initiative was created in collaboration with HBCUs such as Clark Atlanta University, Tuskegee University, Florida A&M University, Morehouse College, Prairie View A&M University, Claflin University, Hampton University, Tougaloo College, and Xavier University.
SFI will also provide holistic resources including internships, tutoring, and mentoring.
