Federal Student Aid

What Federal Student Aid does

Federal Student Aid (FSA) is an office of the U.S. Department of Education, founded in 1965 and headquartered in Washington, D.C., that administers the federal student aid programs authorized under Title IV of the Higher Education Act. It manages approximately $1.7 trillion in federal student loans across roughly 43 million borrowers, providing loans, grants, work-study funding, and loan forgiveness programs (including Public Service Loan Forgiveness) through the studentaid.gov digital platform and the FAFSA application. The core product portfolio consists of the StudentAid.gov portal, the Repayment Calculator, the Income-Driven Repayment (IDR) Plan Request application, the Direct Consolidation Loan application, the PSLF Help Tool, the FSA ID authentication system, and a network of seven contracted loan servicers (Edfinancial, MOHELA, Aidvantage, Nelnet, ECSI, Default Resolution Group, and CRI). Under the One Big Beautiful Bill Act (signed July 4, 2025), FSA is rolling out two new repayment plans — the Repayment Assistance Plan (RAP) and the Tiered Standard Plan — effective July 1, 2026, while phasing out Grad PLUS Loans for new borrowers and tightening borrowing caps.

The business model is non-commercial: services are free to borrowers, with no fees charged for loan servicing, repayment applications, consolidation, or forgiveness processing. Loan origination interest rates of 6.52% (undergraduate) and 8.07% (graduate) for 2026-27 disbursements, plus a 1.057% loan fee, accrue to the U.S. Treasury rather than to FSA itself. The agency is funded through federal appropriations and operates with 1,001–5,000 employees, having lost roughly half its workforce in a recent reduction-in-force and now rehiring approximately 380 workers. Go-to-market is direct-to-consumer via studentaid.gov and the Federal Student Aid Information Center (1-800-433-3243), supplemented by school financial aid offices at over 6,000 participating institutions. Customer segments include undergraduate and graduate students, parents (Parent PLUS), borrowers in repayment, borrowers in default (5.3–5.5 million borrowers with ~$140B in defaulted debt subject to wage garnishment), and older borrowers (3.1 million aged 62+ holding an average of $44,161 in debt).

Name

Federal Student Aid

Legal name

Federal Student Aid

Website

https://studentaid.gov

Company type

Public

Founded year

1965

Operating status

Operating

Headcount range

1,001–5,000 employees

Short description

Federal Student Aid is a U.S. Department of Education office that administers the $1.7 trillion federal student loan portfolio for 43 million borrowers via the studentaid.gov platform, providing loans, grants, work-study, repayment plans, and forgiveness programs free of charge to users.

Ownership category

akta.pro rank

Product category

Government Education Services

NAICS

Educational Services (611), Educational Support Services (6117), Grantmaking and Giving Services (81321)

SIC

Federal & Federally-Sponsored Credit Agencies (6111), Services-Educational Services (8200)

akta.pro primary industry

Financial Aid Systems, Disbursement & Payment Operations (EDADAHAJ)

akta.pro secondary industries

Financial Aid Administration & Packaging (EDALAJAA), Student Loan Programs & Servicers (Public/Nonprofit) (EDADAHAE), Government Student Financial Aid Agencies (EDADAHAA), Scholarship, Financial Aid & FAFSA Support Platforms (EDAFAMAF)

Keywords

• Federal student loans
• Education grants
• Federal work-study
• Student financial aid
• Higher education funding

Headquarters

HQ city

Washington

HQ country

United States

HQ region

North America

Offices1 record

Markets served

GTM type

B2C

Offering type

Services

Cost components

Personnel, Operations, Technology or R&D, Infrastructure, Others

Revenue model

1. Federal Student Loan Interest: The government earns interest on federal student loans made to borrowers. Interest rates vary by loan type: 6.52% for undergraduate borrowers and 8.07% for graduate/professional borrowers for loans first disbursed on or after July 1, 2026, and before July 1, 2027. The federal government is the lender.

Pricing tiers

Go-to-market motion2 records

Distribution channels4 records

Marketing channels5 records

Core offering

Federal Student Aid (FSA) is an office of the U.S. Department of Education that administers the federal student aid programs, including federal student loans, federal grants, and federal work-study funds. It processes applications, disburses program funds through participating schools, and services the federal student loan portfolio for eligible students attending U.S. institutions of higher education.

Product overview

Federal Student Aid, an office of the U.S. Department of Education, operates StudentAid.gov as a comprehensive federal student aid web portal. The platform consists of the core consumer portal (StudentAid.gov), multiple integrated sub-products including the FAFSA application, loan servicers network, income-driven repayment tools, loan consolidation, the Repayment Calculator, PSLF Help Tool, and the new Repayment Assistance Plan and Tiered Standard Plan introduced under the One Big Beautiful Bill Act. Additional offerings include virtual assistant Aidan, Help Center, Feedback Center, TEACH Grant program, entrance/exit counseling, PLUS loan processing, and FSA ID account management. The portfolio manages the nation's approximately $1.7 trillion federal student loan portfolio serving 43 million borrowers.

Differentiator

Problem solved

Functional benefit

Products and services

• Federal Student Loans Federal loan programs funded by the U.S. government to help eligible students pay for higher education expenses, serviced through federal loan servicers and repaid by borrowers under federal terms and repayment plans.
• Federal Education Grants
• Federal Work-Study Program
• Federal Student Aid Application Processing
• Federal Loan Servicing and Repayment Programs

Quantifiable outcome

• Over 1.2 million borrowers received approximately $90.6 billion in forgiveness through PSLF under Biden-era reforms
• +2 more outcomes

Named customers11 records

Segments6 records

Ideal customer profiles2 records

Technology focussed No

API detail

Has API

No

API docs

API detail

Core technology

AI maturity

App detail

Feature5 records

Partnerships

Seven partnerships are on record, tiered core.

• EdfinancialcoreChannel Partner/ Reseller/ DistributorEdfinancial is a contracted loan servicer assigned to handle billing and other services on federal student loans on behalf of the Department of Education, at no cost to borrowers. Borrowers can contact Edfinancial at 1-855-337-6884.
• MOHELAcoreChannel Partner/ Reseller/ DistributorMOHELA is a contracted loan servicer handling federal student loan billing and account services on behalf of the Department of Education. Contact: 1-888-866-4352.
• AidvantagecoreChannel Partner/ Reseller/ DistributorAidvantage is a contracted loan servicer for federal student loans. Also processes all Direct Consolidation Loan applications on behalf of ED. Contact: 1-800-722-1300.
• NelnetcoreChannel Partner/ Reseller/ DistributorNelnet is a contracted loan servicer handling federal student loan services on behalf of the Department of Education. Contact: 1-888-486-4722.
• ECSIcoreChannel Partner/ Reseller/ DistributorECSI is a contracted loan servicer for federal student loans on behalf of the Department of Education. Contact: 1-866-313-3797.
• Default Resolution GroupcoreChannel Partner/ Reseller/ DistributorDefault Resolution Group handles defaulted student loans on behalf of ED, managing collections and rehabilitation. Contact: 1-800-621-3115 (TTY: 1-877-825-9923).
• CRI (Custom溢)coreChannel Partner/ Reseller/ DistributorCRI is a contracted loan servicer for federal student loans on behalf of the Department of Education. Contact: 1-833-355-4311.

Scale indicators14 records

Recent moves6 records

Expansion highlights5 records

Broad incumbents

• Navient: Major student loan servicer and lender serving the private and legacy federal loan markets; comparable in borrower-management scale and repayment-plan operations.
• Sallie Mae: Largest originator of private student loans and a servicer across both federal and private portfolios; competes for the same borrower relationships that FSA serves through Title IV.
• SoFi: Private student loan originator and refinancer plus a digital banking platform; competes for refinancing customers whose loans are currently held by FSA.

Direct peers

• Aidvantage (Maximus): Maximus-operated federal student loan servicer and the exclusive processor of Direct Consolidation Loan applications on behalf of FSA. Direct counterparty on the consolidation product flow.
• Nelnet: One of FSA's largest contracted federal student loan servicers, handling billing, repayment, and customer service on behalf of the U.S. Department of Education. Direct operational partner rather than a competitor to FSA.
• ECSI: Contracted federal student loan servicer for FSA, serving a portion of the borrower base through the same billing and customer-service workflows.
• Edfinancial: Contracted federal student loan servicer handling billing and account management for FSA borrowers. Comparable operating model with similar borrower interaction volumes.
• MOHELA: Contracted federal student loan servicer for FSA and the primary administrator of the Public Service Loan Forgiveness program. Operates the same borrower-facing workflows as FSA on a contract basis.

Emerging players

• CommonBond (now part of Nelnet): Private student loan originator (now under Nelnet) focused on graduate-student financing; overlaps FSA's graduate PLUS and unsubsidized loan use cases.
• College Ave Student Loans: Online private student loan originator serving undergraduate and graduate borrowers; competes for the same student-aid wallet share that FSA's loan products target.

Market position

Strengths5 records

Weaknesses5 records

Competitive moat5 records

Key risks6 records

Key highlights6 records

Customer concentration

• Xx.com/fafsa
• Facebookfacebook.com/FederalStudentAid

Revenue estimate

Valuation estimate

Number of profiles

Funding overview

Funding rounds

Investors

Funding detail is available on the Subscription and Enterprise plan.Contact sales →

M&A

Investments

M&A and investment is available on the Subscription and Enterprise plan.Contact sales →

Frequently asked questions about Federal Student Aid