Last week the U.S. Department of Education, Office of Federal Student Aid (FSA) announced its next step in its vision to create the “Next Generation (NextGen) Financial Services Environment.”

First, a little background

In June 2017 insideARM reported on the appointment of Dr. A. Wayne Johnson as the new head of FSA. In that announcement, Education Secretary Betsy DeVos said,

"Wayne is the right person to modernize FSA for the 21st Century. He actually wrote the book on student loan debt and will bring a unique combination of CEO-level operating skills and an in-depth understanding of the needs and issues associated with student loan borrowers and their families. He will be a tremendous asset to the Department as we move forward with a focus on how best to serve students and protect taxpayers." 

Fewer than 60 days later, on August 1, 2017, ED announced the “Next Generation Processing and Servicing” plan. In that release, Dr. Johnson said,

“The FSA Student Loan Program represents the equivalent of being the largest special purpose consumer bank in the world. To improve customer service, we will take the best ideas and capabilities available and put them to work for Americans with student loans. When FSA customers transition to the new processing and servicing environment in 2019, they will find a customer support system that is as capable as any in the private sector. The result will be a significantly better experience for students – our customers – and meaningful benefits for the American taxpayer.”

insideARM reported at the time that the anticipated FSA Next Generation Processing and Servicing Environment will provide for a single data processing platform to house all student loan information while at the same time allowing for customer account servicing to be performed either by a single contract servicer or by multiple contract servicers. We commented,

In our opinion, a single database that contains all information and activity on a consumer’s account is an absolute necessity. The Department currently has four primary servicers: Navient, NelNet, Great Lakes Educational Loan Services, and FedLoan Servicing. It is absolutely crazy for a borrower with multiple loans to potentially have accounts with multiple servicers that do not communicate nor share the same database.

In related news, on October 20, 2017 insideARM reported that one of the primary servicers, Nelnet, announced its intentions to acquire another of the primary servicers, Great Lakes Educational Loan Services, Inc. The two companies have been working for some time on a project to develop a servicing platform which they call “GreatNet.” We suspect it has been developed with “NextGen” in mind.

The current request for information

On December 11, 2017 ED posted a Request for Advanced Market Research Information. The announcement states,

Through this initiative, FSA will create world-class, mobile-first, mobile-complete, omni-channel engagement capabilities and a state-of-the-art technical infrastructure. The new environment will increase awareness and understanding of Federal student aid opportunities and responsibilities, improve operational flexibility, and enhance cost and operational efficiency, producing better outcomes for customers and taxpayers. FSA anticipates commercial solutions will be necessary to meet the objectives of this vision.

The 18-page posting includes the diagram below, and states that the initial focus is on the area highlighted in dark blue. Of note to insideARM readers is that to the right of this area, there are “Default Management Collection System” and “Recovery” placeholders, suggesting the vision is that private collectors will ultimately use the same system as servicers. This would definitely be a win for borrowers.


You can view the full Request for Advance Market Research Information here.

Additional information from the notice

This is not a solicitation. No award will be made based on the information received in response to this request for advanced market research. Please note that the responses received may be subject to release if a Freedom of Information Act (FOIA) request is received. 

Responses are due by 2 pm Eastern on Thursday, January 4th, 2018 to

Interested firms are strongly encouraged to register as an “Interested Vendor” on the Federal Business Opportunities website ( in order to receive timely updates regarding this initiative.


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