Earnest, a student loan startup that was acquired by the student loan servicing company Navient in 2017, is turning to industry associations to boost customer acquisition. The company announced last week it is partnering with GRP Advisor Alliance, a network of financial advisers that provides new products, technology and research resources to its more than 530 members around the country. 

“[GRPAA] is one of the largest retirement plan aggregators in the country,” said Martin Hamedani, head of business development at Earnest. “We believe student loan refinancing can help almost everyone with student loans today. The goal is: How do we get [our products] in front of as many people as possible.”  

The company didn’t provide specifics on other marketing initiatives, but said such partnerships are just one of many channels the company uses. 

With the GRPAA partnership, Earnest gains a new method for customer acquisition, which is often very costly for financial startups. Some reports indicate customer acquisition costs for startups can be as high as $300 per customer — and those costs have grown in recent years, according to research from the mobile app marketing company Liftoff.io. Earnest aims to reach the more than 3.6 million end consumers advised by GRPAA members.  

Hamedani said Earnest is open to other partnerships in a variety of verticals, including other financial advisers, fintechs and banks, but didn’t give specifics of any current Earnest partnerships. 

GRPAA’s advisers work with a network of 25,000 employers to help develop financial wellness and retirement plans, meeting with the employers about once per quarter, according to Hamedani. GRPAA’s member advisers have a total of $232 billion in assets under management. 

See also: How digital lender Earnest is charting its growth path

GRPAA consultants communicate with member advisers about new tools that are available and, according to Hamedani, Earnest is currently the only student loan solution the network promotes to its members. Through the partnership, Earnest believes it will appeal to employers with workers who face challenges with putting money into their 401(k) plans due to carrying student loan debt. Hamedani said Earnest pays a fee to partner with GRPAA, but he didn’t give specifics. 

San Francisco-based Earnest was founded in 2013, and operates independently despite being a wholly owned subsidiary. The company offers student loan refinancing, private student loans and personal loans through its online platform. In addition to credit history, Earnest examines income, cash flow data, bill pay history and assets to underwrite customers. The company said in a statement that it has refinanced $8.6 billion in student loans for more than 105,000 customers.  

Hamedani said it takes two minutes for customers to pre-qualify for its loans, and 20 minutes to complete the entire application. The company asks customers for financial and school information when they apply, and it requires a credit score of at least 650 for its student loan refinancing product. 

Despite the partnership with GRPAA, Earnest faces pressure from established competitors like SoFi and LendingTree. However, the company believes the amount of student debt in the U.S., which it estimates to be $1.6 trillion, still leaves room for the company to grow.  

“We’re continuing to double down on building a great experience,” David Green, chief product officer at Earnest, previously told Bank Innovation. “That includes more automation, an easier process, better servicing and continuing to help people pay off their loans faster.” 

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