As Congress moves to enact a bill this week that would kill government subsidies for private student lenders, companies that relied on Uncle Sam must dramatically reposition themselves to stay competitive, observers said Monday.

The House passed a health-care reform package on Sunday that included a bill to end banks' involvement with the Federal Family Education Loan Program (FFELP) which made lenders the middle man for providing government-backed student loans. The Senate is expected to follow suit later this week.

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