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CHANCEN’s offer is expanding: The ISA for living expenses is now available at public universities.

Existing financing options such as BAföG are often inadequate to coverthe living costs of students. This is where CHANCEN eG would like to make a contribution and is expanding its range of financing options from 2022.

For Leonard, a full-time study doesn’t just mean studying, for him, it also means looking for a job and working on the side. Although his mother tries to support him financially, it’s not enough to pay for his apartment in Hamburg and his living expenses. He has no contact with his father, but because his father is still included in the BAföG application, Leonard is not entitled to a higher rate. To compensate for this, he waits tables every evening and on weekends in his free time. The amount of time he invests in his part-time job means neglecting his studies – and Leonard is not a special case.

The ISA for living expenses

Starting in 2022, we will support students in financing their living expenses with the Income Share Agreement (ISA). Graduates will pay a percentage of their income back to the solidarity community; depending on their income – but only when they earn more than a minimum income. Existing financing options such as BAföG are often insufficient to cover the living costs of students. CHANCEN eG would like to make a contribution here and is expanding its financing offer from 2022.

“We have already been successfully offering this model for the financing of tuition fees for five years. However, we have identified clear monetary needs among students and prospective students for financing living expenses as well,” says Lisa Henkel, who heads the living expenses project at CHANCEN eG. “Existing financing options such as BAföG are often insufficient for students to be able to cover their costs incurred.”

Since 2013, the number of BAföG recipients has been falling. Today, only less than twelve percent of all students receive BAföG. Since the allowances for parental income have not been adjusted in line with wage and income trends, more and more families whose children are basically dependent on financial support. Also, the monthly housing allowance of 325 Euro is not adequate for the high rents that are charged especially in large cities.

18 %

of all university entrants decide against studying for financial reasons

45 %

of dropouts with a migrant background cite financial difficulties as the reason for their dropout

867 €

average living expenses

According to the 21st Social Survey of the German Student Union, students have an average cost of living of 867 euros – which roughly corresponds to the BAföG maximum rate of 861 euros. But by no means all students receive the maximum rate. Those who, like Leonard, have no contact with a parent and thus cannot prove their income, also do not receive BAföG. The same applies to students in their second course of study who have exceeded the standard period of study or are starting a course of study later in life and exceed the BAföG age limit of 30 for a bachelor’s degree. Thus, more and more students are dependent on part-time jobs for their livelihood. Overall, more than one-third of all students in Germany are employed. Students from non-academic households are more likely to work and do so for longer. Their studies can suffer as a result, especially if students have to work more than 20 hours a week.

Ten percent of all dropouts without a migration background cite financial difficulties as the main reason for dropping out. Financial difficulties are cited by 34 percent as one of their reasons. Among dropouts with an immigrant background, the figure is as high as 45 percent. In addition, 18 percent of all university entrants decide against studying for financial reasons. “Financial differences lead to inequities in the education system – and that doesn’t have to be! That’s why we have decided to offer the UGV for living expenses as well, starting in 2022,” explains Henkel.

“Education is the foundation of our individual and social development opportunities. Become part of the Income Share Agreement: Help the next generation – and benefit yourself.”

Lisa Henkel

In this way, we are expanding our range of services to all universities and public educational institutions in Germany and thus give even more students free access to education.

This is how the UGV for living expenses works

Students can receive a sum of between 5,000 euros and 30,000 euros from CHANCEN eG to finance their living expenses. For a high degree of flexibility, the contract is concluded over a range of 5,000 euros instead of a fixed amount. Up to 1,000 euros are paid out monthly. Once a calendar year, students can also receive a special payment of 1,500 euros for a special occasion (e.g. new laptop, travel expenses for a semester abroad).

Students conclude an ISA with CHANCEN eG for a repayment period of 15 years. The actual repayment begins after they have completed their studies and have reached a minimum annual gross income of 27,000 euros. Thanks to the guarantee of the European Investment Fund and the associated trust of the EU, the model is associated with less risk for investors associated with it who will receive an annual return.

Admission criteria for students

To be eligible for funding, applicants must be citizens of the EU who are enrolled at a German university. As the funding of living costs is still in its infancy, from 2022 onwards only students in the fields of medicine and economics will be funded.

In the coming months, the list will continuously be expanded to offer ISAs for living expenses in as many degree programs as possible. All students are assessed in a multi-stage selection process to determine the student’s suitability for the program. The following criteria play a role:
● Professional qualification
● Motivation and information regarding the desired course of study
● Fit with CHANCEN eG


Close contact to sponsored students

It is important to CHANCEN eG that sponsored students are successful, complete their studies and find a good start to their careers. To this end, students provide proof on a semester-by-semester basis that they are actively studying; and they receive a coaching offer that helps them to optimally master challenges in their studies and career entry. Funding is provided over the standard period of study; in addition, two additional semesters of funding offer students flexibility and security – because only around one third of all students complete their studies in the standard period of study.

Caught your interest?

If you want to help students like Leonard and want to learn more about impact investing for this sustainable type of money, feel free to contact us. We would be happy to advise you on the design of your impact investment and answer any other questions you may have.

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