Private schools that cater to low-incomestudents are popular with parents seeking alternatives togovernment schools. But these private schools, which areoften owned by local entrepreneurs, may lack the resourcesand incentives to expand enrollment or improve quality. Theygenerally operate in markets where access to credit islimited and where there aren't loan products tailoredto their needs. This means that any improvements have to befinanced through school fees or their own funds. When donorsand investors step in to provide support to private schools,they tend to focus on larger operators with a chain ofschools, which typically implies selective funding to alimited number of schools rather than broad support to theschooling market. Is this the best way to support privateschools that cater to poor families? Could supporting theentire market, rather than select schools—or chains—lead tomore competitive pressure to invest in quality improvementsthat promote students’ learning? And is a market for loansfor private schools sustainable?
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