ACE: Access to Capital for Education

Institutional Refinancing for Income Share Agreements (ISA)

Partner Pitch | Confidential

1. Executive Summary: Capital for Growth

The Goal: Provide Education Providers (BT) with immediate liquidity to scale student enrollment without balance sheet strain.

• The Model: A "Dual-Track" architecture that separates your social mission from capital market requirements.
• The Result: Access to a EUR 50M+ pool of institutional capital (Banks, Insurers, DFIs).
• Your Role: Stay focused on education and student success; we handle the institutional refinancing.

2. Situation: The German Skills Gap is Widening

Market Pressure: 15% of 25-34 year-olds lack secondary qualifications; the "Green & Digital Transition" requires massive reskilling.

• Student Reality: 85% of German students rely on family or side jobs because traditional bank loans are inaccessible.
• The Barrier: High-quality education is expensive; students cannot always pay upfront, and providers cannot act as long-term banks.

3. Complication: The "ISA Scaling Trap"

Liquidity Bottleneck: Offering Income Share Agreements (ISAs) or "Umgekehrter Generationenvertrag" (UGV) ties up your capital for 5–10 years.

• Risk Concentration: Providers currently carry 100% of student payment volatility (e.g., hardship cases, unemployment).
• Refinancing Gap: German banks struggle to lend against ISA portfolios because they are "non-standard" and capital-intensive (RWA) to hold.

4. Solution: The Dual-Track Refinancing Engine

Clean Separation: We split the "Impact Level" from the "Capital Market Level."

• Impact Level (You): You manage student relationships and social hardship rules.
• Capital Level (Dignity): We provide you with a fixed-rate refinancing loan, converting your future student receivables into immediate cash.
• Structural Innovation: Using a Luxembourg SSPE to make education "bankable" for institutional investors.

5. How It Works: The "No-Look-Through" Advantage

Fixed Cashflows: Dignity refinances the Provider, not the Student.

• Risk Shield: Your social "hardship" rules (e.g., payment pauses during unemployment) stay with you.
• Mechanical Waterfall: The Capital Market level sees only a clean, senior-secured loan, making it STS-compliant (Simple, Transparent, Standardised).
• Compliance: Fully aligned with EU Securitisation Regulation (2017/2402).

6. Financial Impact for Your Institution

Instant Liquidity: Receive capital upfront to cover teaching costs and expansion.

1. Growth: Scale from dozens to thousands of students without waiting years for repayments.
2. Balance Sheet Efficiency: High-quality refinancing improves your institutional credit rating.
3. Lower Costs: By involving DFIs (Development Finance Institutions), we reduce the cost of capital by ~150bp compared to standard private equity.

7. Market Fact: The Shift to "Chance-Capital"

Institutional Demand: Investors are moving away from traditional debt toward SFDR Article 8 (Social Impact) assets.

• German Market Trend: Traditional student loans (e.g., KfW) have seen a 28% drop in new contracts—students are demanding more flexible, income-based models.
• First-Mover Advantage: Providers using the Dignity platform position themselves as leaders in "Social Mobility."

8. Governance & Impact Framework

Article 8 SFDR: The platform is designed to meet strict EU sustainability and social criteria.

• KPI Focused: We track "Social Mobility" and "Educational Success" as core metrics.
• Professional Servicing: Integrated reporting and income verification processes reduce your administrative overhead.

9. Structural Safety: The Luxembourg Advantage

Bankruptcy Remote: The assets are ring-fenced in a Luxembourg Compartment, protecting you and the investors.

• Transparency: Annual audits and quarterly reporting provide "Bank-Grade" trust.
• Regulatory Peace of Mind: Structure vetted for German KWG (Banking Act) and BaFin compliance.

10. Next Steps: Onboarding as a Partner

Eligibility Check: Review of your current ISA/UGV contracts and student success rates.