Lumni Income Share Agreement
Case Study

Lumni Income Share Agreement

July 2020

Author: Michèle Manpreet Ryatt, supported by NORRAG


Lumni was founded in 2002 in Colombia with the objective to finance students’ university fees using an income share agreement (ISA) financial instrument. By means of an ISA, a private investor or investing organization provides a student with up-front capital for financing higher education. In exchange, the student pays back a percentage of their future income for a defined period of time after they finish their studies. Unlike a loan, there is no principal balance to repay with an ISA, and depending on employment success and earning level after school, the student may ultimately pay more or less than the amount initially financed (Palacios et al., 2014).

In 2011, Lumni raised a total sum of USD 17 million to finance the education of students in Colombia, U.S.A., México, Chile, and Peru (Bornstein, 2011). By 2016, Lumni had supported 8,000 students and experienced 800% growth (Dinero, 2016). In 2019, Lumni raised USD 1.5 million as investment for 360 students with its newest branch based in Peru (Global Innovation Exchange, 2019).