FEAs are the next generation of student finance.

An FEA means the amount you pay for your course depends on the graduate earnings you achieve. Repayments are defered until you are earning above a minimum income threshold. You repay a small percentage of your salary for a defined period with the maximum amount repaid capped, to share risk and make repayments more affordable. If your salary goes down, or is less than we expect, then you will repay less. Equally, if your salary is more than we predict then you will repay more. The benefit of this is the total amount you repay is capped so that if you repay more you may be able to repay your loan early. Equally, if you earn and repay less you will not have to make any extra repayments.

Why an FEA from StepEx?

StepEx is the only provider of Future Earnings Agreements in the UK. Similar products exist in other countries - "Human Capital Contracts" in Latin America and "Income Share Agreements" in the US, however these are unregulated and so do not have the consumer protections and transparency afforded by "Future Earnings Agreements".

StepEx is fully regulated by the UK’s financial regulator (the Financial Conduct Authority). This ensures that our customers are treated fairly, have full transparency of relevant information and we operate to the world’s highest financial standards.

Representative Example

Jane needed £20,000 of funding to complete the final year of her MBA and graduate in 2020. StepEx estimated her prospective income based on her profile, and offered her an FEA of £20,000 in return for 7.4% of her gross income over 5 years. Jane accepted the offer, successfully completed her course and started a new job in January 2021

  • Jane's Income
  • £60,000
  • £65,000
  • £70,000
  • £75,000
  • £80,000
  •  
  • 2021
  • 2022
  • 2023
  • 2024
  • 2025
  • Repayments @ 7.4% share of income
  • £4,460
  • £4,830
  • £5,200
  • £5,580
  • £5,950
  •  
    Jane's Income
    Repayments @ 7.4% share of income
  • 2021
    £60,000
    £4,460
  • 2022
    £60,000
    £4,460
  • 2023
    £60,000
    £4,460
  • 2024
    £60,000
    £4,460
  • 2025
    £60,000
    £4,460

NB: Numerical data has been rounded for simplicity.

Probability of Earnings Table

FEAs are unlike debt in that the total amount you repay is not fixed, instead it is linked to what you earn. This means FEAs do not have a fixed APR or interest rate like traditional debt products. This means that if you earn more than predicted, the amount you repay will be higher and if you earn less it will be lower.

The table below gives an indication, based on historic data of how much you are likely to repay in total for a typical course provider. As an example, if you borrowed £10,000 and repaid £12,000 over a 5 year period, you would have repaid 120% of the amount you borrowed.

  • Proportion of amount borrowed repaid
  • Probability
  • Less than 115% of the amount borrowed
  • 14.9%
  • Less than 130% of the amount borrowed
  • 51.0%
  • Greater than 160% of the amount borrowed
  • 10.6%

Based off a representative example of Postgraduate Certificate in Education (PGCE) graduates from a range of UK universities, drawing on data from 2006 to 2016 with a five year repayment term. For graduates of different degrees, these values may be higher or lower. The maximum you could repay is capped based on a multiple of the credit initially borrowed.

FEA Calculator

Find out how much of your future earnings you could be investing in yourself right now.

£ 0

The maximum amount repaid is between 1.5x and 3x the amount borrowed depending on the course provider- there is a very low probability that a borrower will ever repay the maximum amount given that they would need to earn substantially more than the projected income. If annual income never exceeds the minimum repayment amount, typically £25,000, then you will make no repayments until you earn over a defined minimum threshold. To ensure this product is affordable there are restrictions on how much of your future earning you can commit, typically this limit is 15%. This calculation is based on an approximate equivalent 9% APR. The expected cost of StepEx finance can range from 0% APR to 9% APR depending on the course. If you earn more than expected you will repay more and if you are earn less than expected you will repay less.

Ready to begin your journey?

If you understand what an FEA is and think you may be eligible then please apply.

Anything else you want to know?

If you have questions not covered by our FAQ page, please contact info@stepex.co.