Why are Pay After Placement Courses a Smart Investment?

Introduction

As a mere 13-year-old, I always used to see my Father count the 500 rupee notes before the 3rd of every month and head towards the bank. Every time, the total was roughly Rs. 4000. It was a great deal of money back in those days when I was in school!

Putting the finance jargon in place, was I able to provide a good ROI on my education investment? In terms of soft skills, yes!

But was I prepared to fight and survive the real world? Was I taught how to manage finances, handle a breakup, or learn the industry skills to secure a job in the big MNCs? No.

That’s where I fell behind - to date, most students do. According to various sources, the average private school across India charges between INR 50,000 and 1.5 lakh in urban areas (K-12).

Higher education costs are on the rise, with private engineering colleges charging anywhere between 1 - 3.5 lakh rupees annually. Top private MBA colleges charge even more, with their fee structure soaring high, up to 20 lakhs for a two-year program.

Can I ask you a question now - How will students from lower economic sections of the country afford this kind of education - that’s where pay after placement bridges the gap.

Are pay after placement courses worth your money? Is it worth investing in? Well, let’s explore!

Let’s hit the statistics

As per the Government of India’s Ministry of Education, in line with the reports by Public Sector Banks (PSBs), education loans disbursed in 2020-21, 2021-22, and 2022-23 (till December 31, 2022) were Rs. 11,448 crore, Rs. 16,193 crore, and Rs. 17.668 crore respectively.

In all these 3 years, education loans were disbursed to 4.07 lakh, 4.56 lakh, and 4.97 lakh accounts, respectively. (Digital Sansad)

This gives you a clear canopy view of how higher education loans have gained progressive momentum over the years. Now, here comes the worst part.

PSBs in India reported a decrease in gross NPAs (Non-Performing Assets) from 7.3 trillion Indian Rupees in 2019 to 5.4 trillion Indian Rupees in 2022. (Statista)

Non-Performing Assets is a term used by banks to declare the default rate of loans which are unpaid for a period of more than 90 days.

According to RBI, in FY24, the gross non-performing loans (GNPA) ratio for Indian banks was 2.8%, which was a multi-year low. The Net NPA was 0.6%. (Economic Times)

As of 2024, the student loan default rate is 7-8%, which means every year, a large portion of students fail to repay their debts, which again is a direct hit to the country’s economy.

That’s where pay after placement comes in! The PAP model is directly proportional to lowering student debts and increasing job placements with its outcome-oriented education.

Top 6 Benefits of Pay After Placement Courses

Investing 1 Re. to churn out a return of 10 Rs. - that’s human nature! Before you move forward with pay after placement courses, it’s essential that you know why it is a smart investment.

Here are the top 6 benefits of pay after placement courses and why it is worth investing in.

Financial Security

The core of pay after placement lies in the fact that, as a student, you only need to pay course fees after you secure a job. Rather than paying hefty course fees, you can enroll and learn at zero upfront cost.

Upon completion of the course, you need to pass one final evaluation exam to demonstrate your concept learnings that will be required during your placements.

Additionally, you will also be eligible to get placement assistance from the Institute itself, and you only need to pay the course fees after you land a job above a certain salary threshold.

The entire PAP model focuses on outcome-oriented education that imparts you with practical skills to make you job and industry-ready from Day 1.

This method of learning eliminates the need for financial burden and allows you to invest in quality education without breaking the bank.

Better ROI compared to traditional loans

Let’s be blunt for the next 2 minutes - why does one opt for student loans? To study at a reputable institution and crack a high-paying job.

However, the statistics tell a completely different story. Reports show that a majority of student debts have been declared NPAs by the banks, which means that students have failed to repay their loans and are outstanding for over 90 days.

The pay after placement model safeguards students' interests according to the ISA agreement, wherein you only pay if your education leads to employment, and that too, above a certain salary, which is a far more financially sound decision.

Shared Accountability

Pay After Placement Courses aligns the incentives of both institutions and the students. Students get to learn at absolutely zero cost, get free placement assistance, and only pay after they get placed.

The fact that institutes can only generate revenue after they get their students placed above a specific salary threshold creates a mutually beneficial relationship between the two.

This ensures quality and accountability are maintained in the overall education process.

No risk of unemployment-driven debt

Gear up because this has to be my favourite benefit of pay after placement courses. In PAP, if you fail to secure a job at or above the salary threshold promised by the institute, you don’t have to pay the course fees.

For Instance, let’s have a look at what Masai offers. Masai's Pay After Placement program offers you a minimum salary of 3.5 LPA. So, you don't have to pay a penny if you fail to secure an offer at or above 3.5 LPA or accept an offer below 3.5 LPA.

Ideally, the entire course that you learned becomes ‘FREE’ for you. No strings attached! This contrasts with traditional loans, wherein you are bound to repay back loans, regardless of whether you secured a job or not after completing your studies.

This outcome-oriented approach is the reason why pay after placement is becoming an increasingly popular option among students.

Skill-Based Learning

The holy grail of pay after placement is to get its students placed, which is due to the fact that it’s a mainstream channel of revenue generation.

For the same reason, these institutes oppose the traditional curriculum that lacks imparting practical skills.

The pay after placement curriculum is designed in a way that prioritizes skill-based education over theoretical knowledge to get you job-ready. PAP is actively involved in imparting high quality-skills that employers seek.

Last but not least, the PAP model prioritizes employability over just academically-inclined education, making it a great strategic investment in one’s career path.

Attractive to career switchers

Let me speak about myself here - I was in the tech domain for almost 2 years. Post-COVID, I thought of switching to marketing as this was a vertical that always excited me.

I was fortunate enough to understand the hook and crook of the Industry myself and create an impressive self-project portfolio to crack my first marketing job.

But let’s just skip my self-promotion and talk about the majority here. Dropping hundreds of articles, if not thousands, let me take you directly to IIT. Over 60% of IIT-Bombay Graduates are opting for jobs not linked to their branch. (Indian Express)

This imposes severe demand on online Institutes offering tech and non-tech courses, viz. Software Development, Data Analytics, Digital Marketing, UI/UX Design, and more.

However, being reluctant on additional debts to switch careers is no longer necessary. Moreover, the placement assistance and ‘pay only after you get a job’ model is what makes pay after placement extremely beneficial.

Takeaway

Wrong Questions lead nowhere. But wrong question in the right direction leads somewhere.

I hope I was able to clear your clouds on why pay after placement is a great investment towards your career growth, and why should you move forward with it.

In contrast to choosing the path of hectic student loans without the guarantee of securing a job, pay after placement courses solve the hurdle without much pressure on your wallet.

The first Education reform in India was on 1968, via the National Policy on Education (NPE), formulated by former Indian Prime Minister Indira Gandhi.

Fast forward to 2024, it has been 56 years, but sadly, not much have changed. Today, it's not only about having access to quality education, but access to practical industry-ready skills that employers seek.

And what best way than pay after placement courses to learn and upskill, that too at zero upfront cost?