The International Finance Corporation, a member of the World Bank Group, signed an agreement last week with Saudi Arabia's Riyad Bank to introduce a new student loan scheme that will finance the education of male and female university students across the country.
Under the partnership, the Riyad Bank will originate, fund and administer student loans aimed at encouraging students to pursue higher education in selected disciplines.
Talal Al-Qudaibi, President and CEO of Riyad Bank, said: "Higher education in Saudi Arabia is expanding at an impressive rate with increased involvement from the private sector and new fee-based institutions entering the market.
"Riyad Bank is pleased to participate in this initiative to support access by students to quality education especially in priority disciplines such as medicine, engineering, business administration, accounting, and finance."
Guy Ellena, IFC Director for Health and Education, said: "The project will provide a stable source of funding for private universities in Saudi Arabia and help guide students toward strategic fields of study and careers that have the most employment potential for the Saudi economy."
Michael Essex, IFC Director for the Middle East and North Africa, said that by
demonstrating student lending was commercially viable, the scheme might encourage other financial institutions to enter the education sector.
"It will also create linkages between local financial institutions and universities," Essex said
The finance corporation has established similar student loan schemes in the West Bank and Gaza, and Jordan.
The Riyad Bank is one of the largest in Saudi Arabia and has joint venture leasing and insurance subsidiaries, fully owned investment and real estate subsidiaries, a branch in London, a representative office in Singapore, and an agency in Houston.
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