Uncertain times have been the best time for business schools in the west. More students than ever apply to business schools during times of uncertainty or crisis to ensure that they ride out the tough times and hope that the economy during their graduation is in better shape. It would not be surprising to see that some of the schools in the US getting record application numbers this year. During recessionary times the opportunity cost of attending a business school is much lower and the competition much higher.
The US MBA has forever been looked as the holy grail - a degree from the top schools has tremendous value because of the phenomenal curriculum, cutting edge knowledge and world class people attending these programs from across the world. Schools forever have touted their amazing alumni strength worldwide, their students from varied backgrounds and countries and their world class professors.
The credit crunch however has caused in a possible dent in all this well-being. The very premise of international students attending the top programs in the US is in doubt because of loans now not being disbursed to international students without a co-signer in the US. Some of the top schools including Wharton, Harvard, MIT, Michigan, Cornell, Ross and many other schools provided loans to students using Citibank's loan program known as CitiAssist which allowed foreign students to borrow without a cosigner, while most similar programs require that a U.S. citizen or permanent resident cosign the loan.
This cancellation of the CitiAssist program has got business schools scrambling to make alternative arrangements. Most of the international students who get admitted to these top colleges take up a loan from CitiAssist to fund their education and the cancellation of a program would ensure that many students will now be unable to arrange for the funds to compelete their MBA in the US. A school like Wharton will be most affected because over 40% of the students in a class are international and a lack of a loan makes the education almost impossible to fund for a majority of them.
For Indians, it's a double whammy, with the rupee weakening against the dollar and the lack of a loan possibility - the cost a quality international education just about went beyond reach. I am sure the business schools are trying everything they possibly can to ensure top talent finds a place in their schools. Plus some of the top schools have very large endowments and they may consider dipping into it to ensure that the quality of students do not suffer. However it is a time of uncertainty - schools haven't announced any major changes to their funding rules and there are no guarantees of students enjoying co-signer free loans. I personally hope that the top schools in the US find a way to keep attracting top international talent. I spent two years and had a phenomenal experience at The Wharton school and it goes without saying that the people were the key to the experience. More importantly, I would not have been able to attend the school if it had a cosigner loan clause. Knowing the strong focus the administration has towards attracting the very best students irrespective of country - I am sure they will find a way to ensure all future generations of students do get to enjoy the very same education that makes it so unique and international.
If the student loan problem does not clear up, Indian students might have to consider alternative locations for completing their education like UK, Australia, China or even some advanced courses within India. With most of the MBA aspirants going to top schools abroad in the 4+ year work experience category, the one year programs by the IIMs and ISB might gain access to very talented and bright individuals.
Allwin Agnel is Founder and CEO, PaGaLGuY.com and an alumnus of The Wharton School, University of Pennsylvania from the class of 2008.