This spring the University of Pittsburgh will pilot a “pay-it-forward” financial aid program that offers students up to $ 5,000 after graduation to pay off student debt. In return, the university asks, but does not require, graduates of the program to contribute to a fund that will fund the same debt relief scholarships for future students of the program.

Rohit Anand, a recent Pittsburgh graduate, hopes the Panthers forward will serve as a response to the growing student debt crisis. According to the Institute for College Access and Success, in the United States, in the United States, two in three seniors graduate with debt, and these students leave with an average of $ 28,650 in loans. In Pennsylvania, it’s worse: graduates with debt walk away with an average of $ 36,854 in loans.

Anand and his team at Altian Education, a company he co-founded to develop and promote community engagement networks like this, designed the program alongside Patrick Gallagher, Chancellor of the University of Pittsburgh. . Their goal was to create something that “gives students more flexibility to pay prospective students without the burden of loans,” he said.

The University of Pittsburgh is currently the first and only client of Altian Education. The university hired the company to develop the program, and Anand said it “does not derive any income from the Panthers Forward program itself.” All contributions from Panthers Forward alumni will directly fund future debt relief scholarships.

The first group will consist of 150 students, and any senior graduate with federal subsidized or unsubsidized loans can apply online. The money will be sent directly to the loan manager upon graduation. For now, the university will not apply the $ 5,000 to private loan debt.

“The lender for a federal loan is the federal government,” said Anna Adams-Sarthou, program manager for Panthers Forward. “[This way] we don’t send checks to different banks, we send a check to … the federal entity that makes these loans.

The university seeks “good” students, not only academically, but also through clubs, student governments, athletics or internships. The brief request asks students to list their volunteer activities and hours, provide a faculty reference, and write 250 words about how the University of Pittsburgh made a difference in their lives.

The money for the first round of students will come from the Chancellor’s discretionary funds, but Anand and Adams-Sarthou hope the fund will become “eternal.”

“In a perfect world, sure, that would be great, but we’re realistic and we don’t think it’s going to be self-sufficient a year from now,” Adams-Sarthou said.

Anand didn’t want to estimate how long it would take.

“We are not currently focusing on such estimates. We first want to see how the program is received by students and how it will develop over the next two years,” he wrote in an email. . “This initial phase of the program will be indicative of how the future of the program, including when it is self-sustaining, is planned.”

Anand and Adams-Sarthou stressed that fellows are not required to repay the money in any way, and the group does not yet have recommended repayment plans in place.

“We do not intentionally impose any type of payment or specified payment plan, although we do hope that students who graduate from the program choose to have a plan in place to make recurring payments in amounts of their choice,” Anand wrote.

Justin Draeger, president and CEO of the National Association of Student Financial Aid Administrators, is optimistic about the success of the program given Pittsburgh’s long-standing commitment to financial aid.

“On a larger scale, that’s kind of what’s supposed to happen when you pay state and national taxes,” he said. “That’s how federal student aid was born … and now we have a program that does it at a hyperlocal level.”

The psychology of pay-it-forward is essential to the success of the program. Ayelet Gneezy, associate professor of behavioral science and marketing at the Rady School of Management at the University of California at San Diego, and expert in the “pay-it-forward” and “pay-what-you-want” models, said the success of the program will require a few key elements: a well-crafted application, fostering a feeling of charitable giving and a reasonable time frame to repay the fund. Anand said the university will keep in touch with graduates of the program, but details on how, when and how often are still being decided.

Choosing students who already have good will towards college is smart, Gneezy said.

“If you try to think, ‘OK, when are people going to be put in a situation where they want to do the right thing? “Take, for example, Starbucks versus local coffee,” she said. “I would probably like to reciprocate or be nice to my local coffee shop rather than Starbucks.”

Language is also important. Graduates will be more likely to repay the fund if they know the money is going directly to other students.

“What we found out is that when you define it as payment up front, people pay more than if you define it as payment you want,” she said.

Draeger mentioned that the impact of Panthers Forward could be twofold: a permanent fund for debt relief scholarships and a strong network of young alumni who are inclined to give back to college.

“It’s clear that it’s also about creating a foundation for sustainable fundraising and engaged alumni,” he said. “It is this secondary play that, if Pitt succeeds, can serve as a model for other schools in the future.”

In addition to the Debt Relief Scholarships, admitted students will be welcomed into a network of Panthers Forward alumni to whom they can turn for professional advice and guidance. Adams-Sarthou pointed out that the network aspect also had no defined obligations.

“Sometimes it will be about setting up a more formalized network; sometimes it’s going out for coffee and talking about ‘this is what i did in college, but now i’m thinking about doing something else, ”she said. “We intentionally don’t try to structure it because we don’t want it to look like a series of mandates: ‘if you are part of the program, you have to do x, y and z’. “