Trivia website erases student loans but offers no financial wisdom

Youth pastor and recent college graduate Kevin Foster unexpectedly won his way out of more than $30,000 in student loan debt in June by registering with a website called Givling.

“I looked down and there was the check behind him,” Foster told Business Insider, recalling the moment a Givling representative arrived at his front door with $32,000. “That’s when I started freaking out.”

A pay-to-play online trivia game, Givling boasts it is the pioneer in “gameified crowdfunding.” Trivia devotees pay for Givling “coins,” which unlock trivia challenges. Each purchase of a Givling coin funds the payoff of a $5 million bundle of student loans, as well as $5 million in cash rewards for the players, or “funders.” Student loan debt-holders are not required to play in order to be placed in the queue for debt repayment.

While Givling appears to be a clever and appealing strategy to combat a pervasive problem, its underlying philosophy is steeped in the malaise of those who have borrowed their way into the wrong end of financial hardship.

Givling founder and Stanford graduate Lizbeth Pratt was inspired to create the service after one of her business partnerships went south. Pratt won a court case against the swindling partner, but never recovered any losses because the partner declared bankruptcy immediately following the verdict. Pratt ended up divorced and declared bankruptcy herself in the messy aftermath.

“I was reading that Congress had passed a law forbidding student debt-holders from declaring bankruptcy,” Pratt explains on the Givling website. “Donald Trump, I, gamblers, the manager that swindled me—we all declared bankruptcy. How could it be against the law for a student loan-holder to declare bankruptcy, simply because he/she bought into the American dream of a college education?”

Similar to programs like Rolling Jubilee of the Strike Debt movement, Givling is based on the presumption that student loan debt is fundamentally necessary to secure an economically sound future in the modern world.

“Some debts are just, and others are unjust,” Thomas Gokey, one of Strike Debt’s organizers and the vice president of Rolling Jubilee’s board of directors, told NPR. “Providing affordable, publicly financed, world-class education is a moral debt we are failing to pay.”

But while attention-grabbing innovations like Givling are on the rise, actual default rates are down. A June 2014 study released by The Brookings Institution reported the average national student loan default rate was less than 14 percent and trending downward. The report also showed that even though higher education costs continue to rise, the monthly payment burden for student loan holders has actually lessened over the past several decades. That monthly payment burden is calculated based on the borrower’s earnings versus their debt payment.

While some graduates chafe at the consequences of their educational choices, others buckle down to pay the piper. When Foster decided to give Givling a whirl, he was working three jobs—in a kitchen at a local private college, as a para-educator in a high school special education classroom, and as a server in a restaurant. He’s now working full-time in ministry, but he’s not out of debt yet. Foster and his wife continue to pay down her remaining $10,000 in student loans.