Students’ Futures as Investments: The Promise and Challenges of Income-Share Agreements. AEI Series on Private Financing in Higher Education

Income-share agreements (ISAs) are an emerging idea for helping students pay for college. Under an ISA, investors provide upfront sums of money toward students’ college tuition and other associated costs in exchange for a fixed percentage of the recipients’ earnings after graduation.
An ISA can take different forms. Some are philanthropic, meaning that successive groups of students receive disbursements from—and pay back into—a revolving pool of money. Under another type of ISA,
private investors expect returns from their investments in students’ educations, gambling that students’ postgraduate incomes will generally be high enough to turn a profit. In yet another incarnation, higher education institutions use funds such as university endowments to finance students’ educations, in exchange for a return that at minimum covers the fund’s operating costs. Purdue University plans to employ this model, making it the biggest player in the United States to try the ISA idea so far.


Source: http://library.providence.edu/fhertr/index.php/2017/02/02/students-futures-as-investments-the-promise-and-challenges-of-income-share-agreements-aei-series-on-private-financing-in-higher-education/