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Peer-to-Peer Lending: How We’re Innovating Financing for Nurse Education in Indonesia

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The COVID-19 pandemic has clearly underscored the urgent need to close the critical gap in health worker coverage. According to the The State of the World’s Nursing Report (2020) by the World Health Organization (WHO), the South-East Asia region is projected to have under 25 nurses per 10,000 people by 2030, below the WHO’s benchmark of 27.4 nurses per 10,000. The countries accounting for the largest shortages in 2018 included Bangladesh, India, Indonesia, Pakistan and Nigeria.

Indonesia currently has 15.3 nurses to 10,000 people and is estimated to have a nursing shortage of 200,000 to 300,000 nurses by 2030. Addressing this shortage would require an increase in the average number of yearly graduates of 8.8% from 2018 to 2030, and in the health care system’s capacity to fully and productively employ the pool of available qualified health workers.

However, healthcare education financing, particularly for nurses and nurse faculty, is almost non-existent or out of reach in low-resource settings where nurses are needed the most. When available, exorbitant interest rates and strict terms limit the ability to repay loans.

The Case for Nurse Education Financing in Indonesia

This is also the case in Indonesia, where higher education is largely unaffordable. Entrance fees of tertiary education institutes can range up to US$3,000 - US$4,000. Even if students manage to enroll and commence their studies, they may not be able to graduate due high completion costs such as certification fees, graduation fees and mandatory training fees of over US$2,000.

The lack of access to higher education is amplified by the limited education financing options offered, especially for the majority of middle- to low-income individuals, who are largely ‘Credit Invisible’, i.e., they do not have access to credit. Those who are able to receive loans are likely to face high repayment burden, which makes them inaccessible to most borrowers. This is especially likely for nurses in Indonesia, whose salaries average US$112 - US$287 a month.

Answering the Need: Peer-to-Peer Lending Platform for Nurse Education

At the Johnson & Johnson Center for Health Worker Innovation, we believe that if we solve the challenges facing frontline health workers, we will improve healthcare for everyone.

That’s why we’ve partnered with DANAdidik to initiate a revolving student loan for Indonesian nursing students. DANAdidik is a peer-to-peer lending platform primarily focused on health education financing, connecting lenders and investors with healthcare students in need of student loans. The Center has provided DANAdidik with an initial fund to be used as lending capital on DANAdidik’s platform to provide concessionary loans. This fund is expected to support Indonesian nursing cohorts in perpetuity, impacting over 2,000 nursing students in the next 10 years.

Additionally, our partnership includes a loan forgiveness feature to incentivize nurses to work in remote or rural areas to address the health worker coverage disparity in Indonesia. Through this first-of-its-kind collaboration, our aim is to enhance the affordability of nursing education and build the nursing pipeline in Indonesia. If successful, we hope to scale this innovative financing model and expand it to additional countries to support more health workers worldwide.

Our Vision: Reach 1 Million Frontline Health Workers and 100 Million People

This partnership is just one of many programs that we have designed, implemented or supported with our partners on the frontlines around the world. Founded to help address the 18 million health worker shortfall in global health, the Center for Health Worker Innovation helps equip nurses, midwives, and community health workers across the globe with the skills, resources and support they need to improve quality of care and strengthen primary and community-based health systems. We aim to support and champion 1 million frontline health workers and reach 100 million people over the next 10 years.

As with all global health challenges, this aim calls for strategic partnership. Therefore, we invite you to join us in exploring opportunities and collaborating to empower frontline health workers globally.