How Does the Church's Perpetual Education Fund Work?

LDS Perspective

The Perpetual Education Fund (PEF) is a Church program established in 2001 under the direction of President Gordon B. Hinckley to provide educational loans to worthy members of The Church of Jesus Christ of Latter-day Saints, particularly in developing nations. The fund operates on the principle of self-reliance and the "perpetual" nature of the resource—participants receive loans to pursue higher education or technical training, and as they repay these loans, the money becomes available to bless other students in need. This creates a revolving fund where today's recipients become tomorrow's benefactors, allowing the program to continue indefinitely without requiring new donations for every student. The process for obtaining a PEF loan involves several steps designed to ensure participant

Historical Perspective

The LDS Church's Perpetual Education Fund (PEF) operates as a revolving loan program established approximately two decades ago, designed to provide educational financing to economically disadvantaged members, primarily in developing nations. While presented to donors as a charitable education initiative, the fund functions distinctly from traditional grant-based charity. Members contribute donations believing their money directly funds educational opportunities; however, the church primarily utilizes the interest generated by the invested principal rather than distributing the donations themselves. This structure allows the underlying fund to remain intact and continue generating investment returns while the interest provides the operational capital for loans. The mechanics of the PEF inv