Wednesday, August 17, 2022

HBS announces tuition waiver for low income students

Harvard Business School has announced waiver of tuition ($76,000 for each of the two years) to the lowest income students for about 10 per cent of its annual intake or 200 students. Students will still have to incur living costs of approximately $35,000 per year. 

HBS is known to offer limited scholarships based on merit. Th expansion of scholarships to those who satisfy certain socio-economic criteria is a huge leap forward. It will make it easier for talented students who lack the means to access one of the most reputed business schools in the world.

The move should make IIMA and some other leading schools in India sit up and think. IIMA used to offer scholarships to the needy but these have been more or less phased out over the years. IIMA argues that the placement salaries on offer at the school are good enough to help students pay back students loans for the two-year programme. So those who gain admission should simply take loans to pay for the programme.

This argument is flawed. Several of the most disadvantaged students would be deterred by the uncertainty factor: what if they ended up with a  below-average placement salary so that it took them very long to repay a student loan? A typical student from a poor family would have to take care of the burden of several family loans. The prospect of having to take another loan could prove a deterrent to his or her accepting admission or even applying. 

For years, the leading IIMs would declare in their Admissions ad that no student would be denied admission for want of funds, meaning the IIM would take care of funding. They need to go back to that noble affirmation. 

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