How early education became the ‘assured returns’ business

How early education became the ‘assured returns’ business Premium

Across Indian cities, the small neighbourhood playgroups have evolved into one of the most lucrative early-education networks. The preschool industry is aggressively marketed as low-investment with high-returns, often promising ₹30–40 lakh annual income on a setup cost of ₹8–10 lakh.

Preschools do not fall under the Right to Education Act and therefore are not required to be not-for-profit like K–12 schools. Many preschool chains operate under charitable trusts or societies, entities that are expected to run for the public good, not private profit.

According to Advocate Abhisek Chowdhury, a trust cannot declare profits, but it can generate surplus and route it towards costs such as branding, consultancy, training, or outsourced services provided by sister companies often owned by the same promoters. Rent, management fees, curriculum development charges and franchise royalties all become legitimate pathways for money to move from a trust into private hands. “It's not technically illegal,” he says, “but when a trust functions like a corporate chain, the spirit of the law is clearly being defeated.”

Franchise owners often discover the hidden costs after joining the system. A former Noida franchisee said she invested because advertisements promised a quick return but realised later that her revenues were offset by constant demands for upgrades and marketing contributions.

Many franchisees say they were drawn by attractive ads promising ROI, not by a passion for education. A preschool franchise owner on the condition of anonymity said, “The ad read: Invest ₹10 lakh and earn ₹40 lakh every year. But the royalty and mandatory purchases eat into everything. The chain makes more than the franchise.”

The Franchise investors are describing it as a model where the curriculum is just one small part of what they pay for. The real cost lies in franchise fees, royalties, branding, curriculum kits, annual training upgrades and mandatory purchases of uniforms and learning materials.

Preeti Jain in Kolkata said the business works only in high-income neighbourhoods, “If I had opened this in a middle-class area, I would have shut down. Preschool is now a luxury product.”

Parents, meanwhile, feel education is being packaged as a consumer product. Many complain that preschool fees now rival those of primary schools, with glossy marketing promising “global pedagogy” and “future-ready curriculum” for children barely three years old. A Bengaluru parent described the experience bluntly — “The school is run by a trust, but the fees feel like corporate pricing. It starts to look like we're shopping, not choosing an educational environment.”

Experts warn that this unchecked commercialisation risks deepening inequality. A Delhi-based NEP researcher argues that quality pre-schooling is foundational to cognitive and social development, yet when it becomes a luxury product, access becomes tied to income.

The researcher highlights that there are no national standards for preschool curriculum, no cap on fees, and little oversight on teacher qualifications, even though teachers are often paid shockingly low salaries. With no regulatory framework and little transparency on how trust-generated revenue is used, India's early education landscape is drifting further into a business-driven model, leaving children, its most vulnerable beneficiaries at the margins of a profit-first system.

(Nibedita Sen is an independent journalist specialising in defence, with over 15 years of experience covering diverse topics like rural India, healthcare, education, and women's issues.)

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Published - November 27, 2025 06:06 pm IST

education / children / parent and child

Source: The Hindu
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