State nonprofit outlines loan, grant and employer‑partner programs to reduce dropouts and strengthen workforce pipelines

Ray Jones, vice president of loan programs at South Carolina Student Loan Corporation, told the House Education and Public Works Committee that the Columbia‑based nonprofit has broadened its work to include grants, persistence funding and employer‑partnered programs designed to keep students enrolled and connect graduates to jobs.

Jones described the nonprofit’s history, its current programs and its shift after 2010 away from administering federal student loans. “We preach borrowing responsibly,” Jones told the committee, summarizing the organization’s counseling emphasis while describing private loan products and targeted grant programs intended to reduce stop‑outs and default risk.

The details matter because many student defaults are driven by students who do not complete credentials but still incur debt; Jones told the committee that the organization’s persistence fund and employer partnerships aim to close small gaps — for example, $500 in emergency costs — that can cause a student to leave school.

Jones said South Carolina Student Loan Corporation was founded in 1973 and administered the federal student loan program in the state until 2010, when federal direct lending replaced state servicers. While the nonprofit now offers private education loans, Jones said it also returns surplus funds to the state through grants and philanthropy. He said the organization has provided roughly $5,000,000 in grants over four years and has helped about 500,000 students statewide via its programs, amounting to roughly $9,000,000,000 in total student aid managed over time.

Jones described a recently launched persistence fund that will provide $5,000 awards (institution‑level grants) that colleges and universities can apply for to help students cover small non‑tuition costs that impede completion. He said the program will be available to all 57 public and private nonprofit colleges and universities in the state upon application.

The nonprofit also described the BOLD Career Pathway program (Better Outcomes Less Debt), which contracts with employers — including hospital systems — to fund training. Jones said employers under contract pay off loans when participants complete training and remain employed, creating an employer‑sponsored pipeline for nursing and other in‑demand roles. He estimated the organization will put roughly $4 million to $5 million annually into such programs.

On default rates, Jones said that while the organization administered federal loans its default rate was about 1 percent; he noted that program structures changed after 2010 and during COVID, complicating straightforward comparisons. He told the committee that many defaults arise from students with modest unpaid balances who did not complete a credential: “The problem with student loan repayment is an $8,000 to $10,000 balance, and that means they attended for 2 years, didn't finish,” he said.

Committee members asked technical questions about interest rates and repayment options. Jones said borrowers can choose fixed or variable rates when available, decide whether to pay interest while enrolled, and select repayment terms (for example, 10 or 15 years). He compared private lender averages to federal options and told the committee that private competitor rates such as those from some large private lenders can be substantially higher; he said their private product rates tend to be lower than the highest private competitors.

Jones also noted a teacher loan refinance proviso drafted by Representative Collins and described an ongoing partnership with the Commission on Higher Education to administer teacher loan and nursing faculty pathways. He closed by urging responsible borrowing and offering the nonprofit’s assistance with FAFSA nights, persistence grants and employer partnerships as tools to improve completion and workforce supply.