Fidelity and Ally announced Tuesday that they will begin offering a free tuition plan to new students in 2019 and 2020.
“We want to help students who need it most by making sure that they have a plan that meets their needs,” said the companies in a joint statement.
The move comes amid concerns among student loan borrowers that their federal student loans will not be serviced for a time in the foreseeable future due to the federal government’s bankruptcy filing.
The government says it has $2.7 trillion in student loan debt.
“It is our understanding that Fidelity will begin providing free tuition assistance to new Fidelity undergraduate students in the coming months, which will begin in the fall of 2019 and will continue through the end of the year,” the companies said.
The free tuition program will be available to borrowers who are either in the top 1 percent of student loan repayment for a bachelor’s degree, or at the lower end of that scale for a master’s degree.
Students with a bachelor of science degree or higher are eligible for free tuition and fees.
The company says the program will provide borrowers with the resources they need to stay in school, pay off their student loans and maintain financial stability in the event of a bankruptcy.
The companies have not yet provided details about how the tuition program is financed.
The announcement comes as the Trump administration is facing scrutiny over its handling of the financial crisis.
The Education Department last week released a $15.8 billion plan to help struggling borrowers get out of debt, but the administration has not yet released details about the plan or when it will be implemented.
The Trump administration has said that the plan will allow borrowers to stay on their current repayment plan for as long as it takes to pay off the student loans.