While the 43 million student loan borrowers who collectively owe $1.6 trillion in school debt have received one more extension—this one until Aug. 31—reengaging this audience after a two-year payment moratorium will be challenging, to say the least. Add to that the lack of clarity around what the future holds for the private lending industry and student borrowers, and you have a massive business opportunity for fintechs. 

Student debt disproportionately impacts millennials and Gen Z. Clearly, this audience is vitally important to fintechs, many of which made their names uniquely serving this group with digitized offerings that better met consumer expectations. Serving them in the student loan arena—a major source of stress, and that often represents a person’s first significant financial event—can therefore lead to a lifelong relationship, and cement loyalty if done right.

The right technology can create a more inclusive financial system, which is, after all, the great promise of fintech. And companies that capitalize on this opportunity now by building solutions to support borrowers will be uniquely poised to help a generation in need of both financial and moral support. While student loan borrowers received a 150-day reprieve, and loan forgiveness continues to progress, those solutions are drops in the bucket; we have a broken system. This is where fintech companies can truly add value.

Indeed, we have the chance to contribute to student borrowers and society in a meaningful way with the innovations our companies already excel at. Fintechs are advancing real-world solutions such as:

• Creating new tools to help students manage debt. While more than 30% of fintechs work directly in the lending space, many more are part of this larger ecosystem, highlighting the opportunities for change and innovation in the industry. Debt remains the largest outflow of cash and student debt is a key business opportunity. From loan calculators to easy budgeting tools and from loan organizers to financial wellness programs, fintechs continue to spark new solutions that help students understand and manage their school debt. This critical work needs to continue to grow and reach more borrowers.

• Educating future borrowers about debt management. While a bachelor’s degree confers many long-term financial benefits, more than one-third of college graduates with loans insist that the lifetime financial cost of their degrees outweighs the benefits, according to a Pew Research Center study. They also report that they will have to delay other financial goals—including paying off other debts, investing for the future/saving for retirement and buying a home—once loan repayment restarts, which could create a serious drag on the economy.

• Connecting with employers to provide financial wellness and help with student loans. More than one-third of companies are planning to offer student loan benefits. With the rise of embedded debt infrastructure, companies for the first time have the ability to embed debt solutions into any app or service with our APIs and low-code drop-in modules. At Spinwheel, we make it easy to embed debt management into employee benefit platforms, which can increase employee engagement by 30% and provide a competitive perk. Debt paydown programs linked to company 401(k) accounts can serve as another great incentive and debt-reduction option, and financial wellness programs present a perfect opportunity for adding value.

Borrowers should never be surprised by what they owe and what it will take to repay their loans when they graduate. Debt counseling needs to evolve from its current cursory state into something more robust, tangible and commonplace. We can all contribute to the education young adults need before they take on a significant financial responsibility.

Fintechs have already come a long way in sparking solutions for student debt. However, we need to continue to drive the innovation meter in adding value and helping graduates climb out from under the crushing load of debt that can affect their lives for decades to come.