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Study Abroad | Top 5 Best Education Loan Providers In India

Study Abroad

Funding for study abroad is a significant factor influencing the type of course enrolled by students and the institution chosen.

The best form of financing is to take out an educational loan for study abroad. Indian banks offer different schemes depending on the institution chosen and the field of study. Most educational loan schemes offer a flexible repayment option and allow the borrower to plan their finances accordingly.

Education loans include a moratorium or leave period, which is very beneficial as the borrower is given a period of about six months after completing the course.

Repayment of the education loan can begin after this period or as soon as the borrower has settled.

Education loans also cover meals, accommodation, tuition, travel and other related expenses.

Top Education Loan Providers For Study Abroad

Listed below are the best education loan providers in India to help students who want to study abroad.

State Bank of India Education Loan

SBI provides education loans up to ₹1.50 crowns for study abroad under the SBI Global Ed-Vantage program.

State Bank of India Education Loan
State Bank of India Education Loan study abroad

Courses include a professional and technical degree, a PG, and a degree from a reputable university, such as MCA, MBA, and MS. Qualification courses run by CIMA-London and CPA-US are also eligible for educational loans.

SBI also offers one of the lowest interest rates on education loans in India.

The SBI Scholar Loan Scheme is designed exclusively for graduate students who wish to pursue professional/technical courses at outstanding institutions such as IIT, IIM, and NIT.

Educational loan schemeRate of Interest
SBI Global Ed vantage Scheme9.30%
SBI Scholar Loan scheme6.90% to 8.20%
SBI Student loan Scheme9.30%
SBI Skill loan scheme8.80%
State Bank of India Education Loan

Pros

  • Low-interest rates up to 9.30%
  • NIL processing fee of up to ₹20 Lakhs
  • Various loan schemes

Cons

  • Processing time is long
  • 15% margin for study abroad

Punjab National Bank Education Loan

PNB Udaan is an exclusive funding scheme that supports talented students in higher education abroad at reputable universities. Undergraduate (work-oriented), PG (MCA, MS & MBA), CIMA, CPA, and diploma courses in aviation, pilot training, and navigation are available.

Punjab National Bank Education Loan
Punjab National Bank Education Loan study abroad

For domestic research, the Punjab National Bank offers a number of educational loan schemes. PNB Saraswathi is a regular IBA model educational loan program for gifted students. The PNB Prathibha program is for students who want to pursue higher education at major universities such as IIT, NIT, and other leading business schools.

PNB Kaushal has a credit facility for vocational and skills development courses.

PNB also has area-specific credit facilities such as PNB Honhaar for Delhi students and PNB Bihar Student Credit Card Facility to support Bihar students. They have a special scheme with a discounted interest rate for people with disabilities.

There is even a scheme to help minor communities study overseas through the Padho Pardesh grant scheme.

Educational loan schemeRate of Interest
PNB Kaushal8.30%
PNB Honhaar8.95%
PNB Udaan9.55%
PNB Saraswati Schemeup to 9.55%
PNB Prathibha6.90% to 7.55%
Punjab National Bank Education Loan

Pros

  • Small ROI
  • NIL tuition fees for studying in India
  • Large education loan program

Cons

  • Troublesome paperwork and follow-up

ICICI Bank Education Loan

ICICI Bank offers educational loans up to ₹50 Lakh for studies in India and ₹1 crore for studies on board.

A great benefit is that you do not need to have any collateral for education loans up to ₹20 Lakh (for UG courses) and ₹40 Lakh (for PG courses at top selective institutes).

ICICI Bank Education Loan
ICICI Bank Education Loan study abroad

The main disadvantage of the ICICI Educational Loan is that the vacation payment period is limited to 6 months after the completion of the course, regardless of employment status.

Educational loan schemeRate of Interest
Education loan for domestic and international studies10.25% – 12.75%
ICICI Bank Education Loan

Pros

  • High loan amount
  • Less paperwork and faster processing
  • There is no margin of ₹ 20 million

Cons

  • High-interest rates
  • Hidden charges

HDFC Bank Education Loan

HDFC Bank offers educational loans to study in India and abroad. The maximum loan amount for studying in India is limited to ₹20 Lakhs.

On the other hand, all education costs are covered by foreign education loans and there is no upper limit. However, you must provide the bank with collateral in the form of a fixed deposit or real estate.

HDFC Bank Education Loan
HDFC Bank Education Loan study abroad

Loans are paid directly to the institution based on a fee structure for up to 15 years.

You can see that HDFC Bank does not have a dedicated education loan scheme for skills development courses. Therefore, we recommend personal loans for skill development courses.

However, I think it is a bad idea to take out a personal loan for educational purposes because of the high-interest rates.

HDFC typically takes a couple of days to process a loan application and pay the loan amount.

Educational loan schemeRate of Interest
Education Loan for Indian Education9.25% to 13.68%
Education Loan for Foreign Education9.25% to 13.68%
HDFC Bank Education Loan

Pros

  • Fast processing
  • Low-interest rates

Cons

  • 1% loan processing fee
  • Up to 4% prepaid fee (during the moratorium)
  • Low credibility for Indian research

Axis Bank Education Loan

Axis Bank has only one facility for education loans (between ₹ 50,000 and ₹ 75 Lakhs).

Axis only provides educational loans for graduate or graduate students who have earned at least a 50% grade on HSC or graduate.

Axis Bank Education Loan
Axis Bank Education Loan study abroad

Axis Bank prefers the parent profile. The bank has made it compulsory for parents to present a regular source of income.

Education loan amountRate of Interest
Above ₹ 4 Lakhs to ₹ 7.5 Lakhs14.70%
Above ₹ 7.5 Lakhs13.70%
Up to ₹ 4 Lakhs15.20%
Axis Bank Education Loan

Pros

  • Fast loan application processing
  • Highest loan amount up to ₹ 75 Lakhs
  • NIL processing fee for a loan below ₹10 lakhs

Cons

  • High-interest rates.
  • Up to 15% collateral for loans over 4 lakhs
  • 24% p.a. default interest.

What Is Education Loan?

A major Indian bank offers educational loans in India to help students reach their academic goals. School loans with a maximum repayment period of 15 years start with an annual interest rate of 6.60%.

Study Abroad
Study Abroad

Both domestic and international higher education can benefit from educational credits. The lender decides which courses are eligible for the education loan. You can apply for an education loan for courses starting in kindergarten.

You can borrow a loan for full-time or part-time training, and a loan for professionals working in higher education.

Features of Education Loan:

  • Individuals between the ages of 18 and 35 can use an education loan to proceed with their research at an approved university abroad.
  • Students can obtain educational loans for administration courses, engineering courses, medicine, graduate and graduate degrees, arts, architecture, pure science, hotel management, and more.
  • Expenses covered by the education loan include tuition, exam, laboratory and library fees, caution deposits, travel, books and equipment, projects, and study tours.
  • Borrowers are required to bring in a margin of 5% to 15% for loans borrowed for foreign research.
  • During the Moratorium period, the borrower is required to pay interest and the payment of principal begins at the beginning of the loan holding period.
  • Education loans can be repaid in monthly installments via the Electronic Clearing Service (ECS) or via a check past the date to the bank.
  • Banks generally sanction education loans for up to seven years, including the moratorium period.
  • For a full-time course education loan, you must select a co-applicant. Co-applicants include siblings, spouses, parents, or other family members.
  • Banks sanction up to ₹ 20 Lakhs for a moratorium period and a maximum of ₹ 10Lakhs for a loan without a moratorium period.
  • No security deposit is required for an education loan taken up to ₹ 4 Lakhs. A third-party guarantee has to be given for loans between ₹ 4 lakhs and ₹ 7.5 lakh and needs solid collateral security for loans above ₹ 7.5 lakhs.
  • The central government has also introduced an interest rate subsidy system for repayments made during the Moratorium for the benefit of the weaker parts of society.

Factors Influencing Approval of Best Education Loan in India

CIBIL Score

The first step in applying for an education loan is to check your CIBIL score and ensure that there are no errors in the report.

If you or your co-applicant do not have a good CIBIL score, the bank may reject your loan application.

Eligible Education Expenses

All expenses indicated in the remuneration structure are not considered by banks as financing.

For example, university bus fares are not included in the calculation of eligible costs. But they take into account the cost of overseas travel to the college venue.

Banks take into account the costs required to complete the course to receive the loan amount.

Tangible Security

If you are looking for a loan of 7.5 Lakh and above, then you need to secure the loan by securing collateral. Collateral must be tangible assets such as FD, LIC, NSC bonds, stocks, bonds, and real estate.

“Clearly mention the information about your covered bonds and have ready xerox copies of all supporting documents related to the guaranteed bond.

Course And University Eligibility

Only accredited professional, technical, and UG / PG courses from recognized universities (UGC / AICTE approved) are allowed.

Therefore, before applying for an education loan, check the type of training and the university. Also, check the education bank loan schemes for vocational training courses.

For example, you can’t take out an education loan for a beautician course at the XYZ Bridal Institute. The degree in cosmetology is not professional training, and the institution that runs the course is not recognized by either UGC or AICTE.

Co-Binding/Personal Guarantee

In the case of a minor student, you and your spouse act as joint borrowers. In the case of a major student, any parent with a source of income becomes a joint borrower.

If the loan amount exceeds ₹ 4 lakh, the Bank insists on the guarantee of a third party, which means the guarantee of a known person who is not related to your relationship.

If upon application, it properly discloses its net worth together with documentary evidence, the Bank may consider waiving the third party guarantee.

Vacation Period For Repayment

There are two options for repayment of student loans. One of them is to pay the cost after completing the course and getting a job.

Another option is to pay monthly interest and pay the principal until the end of the course.

Leave can be taken one year after graduation or six months from the date of employment, whichever comes first.

The loan application must indicate that you are willing to pay monthly interest and your source of income, which shows his intention to pay off his education loan.

Also Read: Top 10 Ways | How to Easily Get Student Loan Forgiveness

Conclusion

If you are looking for a higher study abroad loan, consider applying to the SBI (₹1.5 crores).

Conclusion
Conclusion

However, if you need quick administration and a higher amount, you can apply for an education loan from ICICI Bank (up to ₹ 1crore).

Frequently Asked Questions(FAQs)

Are educational loans a good bet for studying abroad?

Yes, taking an education loan to study abroad is the best choice for you. Not only does it help you realize your dreams, but it also saves you money, And the loan covers all the costs of the students during their training period, from the payment of the tuition fee to the number of their living expenses during the study period.

How to choose a bank to get a loan for studying abroad?

Contact the lender who offers you the best interest rate over the life of the loan so the package is cost-effective. In addition to the loan amount, there are a number of costs associated with the education loan for studying abroad. These include, but are not limited to, loan processing fees, moratorium extension fees, prepayment fees, and so on.

How can I get a student loan to study abroad in India?

To apply for a study loan abroad, the following documents are required:
Completed application form.
Photos: Passport-sized photos of the applicant and co-applicant.
Photo ID: Photo ID of the applicant and co-applicant.
Proof of residence: Proof of residence of the applicant and co-applicant.

Can I get a 100% loan to study abroad?

You will receive 100% financing with an education loan for study abroad. This ensures that all your expenses are taken care of.

Can I get an education loan to study abroad without collateral?

Private banks can offer up to 40 lakhs of student loans for unsecured study abroad. As mentioned above, these banks have a list of top universities for which unsecured loans are approved.