Secta Finance has launched a range of finance products to help parents spread the cost of private school fees.
With parents spending around £10 billion on school fees every year, the fintech group said the current payment system is “no longer fit for purpose.”
The newly-launched Secta Flexiplan enables parents to use the equity in their home to secure a facility that allows them to draw funds flexibly within the first five years, with interest paid on the amount they choose to drawdown.
Parents can decide how much they draw, their monthly repayment amount as well as the repayment term, with the option up to 30 years.
Joe Hill, founder and CEO of Secta Finance, said: “How parents pay for private school fees is no longer fit for purpose. They are still paying large lump sums, sometimes with expensive and inflexible means using credit cards or unsecured loans that are simply not sustainable.
“Secta has set out to challenge this approach with a fresh lens and a clear pathway for parents to handle this significant expense. We want to create manageable and affordable finance solutions for school fees, much like the financial products people consider when buying a house or a car.”
Research by Killik and Co found that private day school fees have increased 403% since 1990, which Hill said has led parents to make significant sacrifices.
Hill added: “We are creating opportunities for parents, for schools and for children. By offering finance solutions which are affordable, simple to understand, we will create a sustainable path for better outcomes.
“Our strategic aim is to expand the opportunity of private education to many more families and enable a sustainable relationship for parents and schools through the products that we offer.”